CBN revokes ASO Savings, Union Homes licences in mortgage sector clean-up

Barbara Bako, Abuja.

The Central Bank of Nigeria (CBN) has revoked the operating licences of Aso Savings and Loans Plc and Union Homes Savings and Loans Plc, in a decisive move that signals tighter regulatory enforcement and an intensified clean-up of Nigeria’s mortgage banking sub-sector.…

The announcement was made in a statement signed by Mrs. Hakama Sidi Ali, Acting Director, Corporate Communications Department of the CBN on Tuesday in Abuja.

The apex bank said the revocation, announced on December 16, 2025, was in line with its statutory powers under Section 12 of the Banks and Other Financial Institutions Act (BOFIA) 2020 and Section 7.3 of the Revised Guidelines for Mortgage Banks in Nigeria, underscoring its resolve to uphold prudential standards and safeguard financial system stability.

According to the CBN, the two mortgage banks persistently breached key regulatory requirements, including failure to meet minimum paid-up share capital thresholds, inadequate asset base to cover liabilities, and capital adequacy ratios below the prudential minimum.

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The regulator also cited repeated non-compliance with supervisory directives, despite prolonged regulatory engagements and corrective windows.

Analysts say the action reflects growing intolerance by the CBN for weak capitalisation and governance lapses within the mortgage banking segment, which has historically struggled with balance-sheet weaknesses, limited long-term funding, and poor risk management practices.

The mortgage sub-sector is considered critical to Nigeria’s housing finance ecosystem, particularly as the country grapples with a widening housing deficit.

However, weak institutional capacity and undercapitalisation among some operators have continued to undermine confidence and limit the sector’s ability to mobilise sustainable funding for home ownership.

By revoking the licences, the CBN is seeking to ring-fence depositor funds, prevent systemic contagion, and send a clear signal to other operators that regulatory forbearance has limits.

The move also aligns with broader efforts by the apex bank to strengthen supervision, improve corporate governance, and enforce compliance across the financial services industry.

Market watchers note that the decision may accelerate consolidation within the mortgage banking sector, as smaller or weaker institutions face increased pressure to recapitalise, merge, or exit the market.

Stronger players, on the other hand, are expected to benefit from improved confidence and a more stable operating environment.

The CBN reiterated its commitment to maintaining a safe, sound, and resilient financial system, stressing that enforcement actions would continue to be applied where institutions fail to operate in line with extant laws and regulatory guidelines.