By Segun Adesemoye
When Olayemi Cardoso assumed office as Governor of the Central Bank of Nigeria in September 2023, he inherited much more than a weak naira. He inherited a monetary system struggling with depleted reserves, a huge foreign-exchange backlog, multiple distortions in the FX market, rising inflation and a serious crisis of confidence.
Three years later, Nigeria is not yet free of its economic difficulties. Cost-of-living pressures remain real, businesses still contend with expensive credit, and millions of households are yet to feel the full benefits of stabilisation. But measured against the situation Cardoso inherited, the transformation at the Central Bank deserves serious attention.
Perhaps the clearest evidence is Nigeria's external reserves. As of September 3, 2026, gross reserves had risen to $54.08 billion — their highest level since 2008. Cardoso also disclosed in July that net foreign-exchange reserves had risen from roughly $3 billion at the beginning of the reform period to about $40 billion. These are not merely impressive numbers; stronger reserves provide Nigeria with greater protection against external shocks and improve confidence in the country's ability to meet its international obligations.
Another significant achievement was the clearance of the verified $7 billion foreign-exchange backlog. For years, airlines, manufacturers, investors and other businesses had struggled with unmet FX obligations. Clearing those legitimate claims helped restore credibility and removed one of the major uncertainties confronting investors and businesses. The CBN itself identifies the clearance as one of the important outcomes of its recent monetary reforms.
Cardoso has also pursued perhaps the most consequential restructuring of Nigeria's foreign-exchange market in years. The old system, characterised by multiple exchange rates and opportunities for arbitrage, has gradually given way to a more transparent and market-driven framework. Electronic FX matching, tighter regulation and clearer trading rules have improved price discovery and reduced some of the distortions that previously rewarded privileged access rather than productive economic activity.
The naira's journey has certainly not been painless. It suffered severe depreciation and volatility during the early phase of the reforms. But recent developments suggest that greater stability is beginning to emerge. In early September, the currency strengthened to about ₦1,315 to the dollar at the official market, its strongest level in roughly two years.
Equally important is Cardoso's determination to return the CBN to the fundamentals of central banking. Under his leadership, the institution has sought to reduce the quasi-fiscal interventions that had blurred the distinction between monetary and fiscal policy and refocus attention on price stability, monetary discipline and financial-system stability.
This has required difficult decisions. Interest rates have remained high as the Bank battles inflation and excess liquidity. Businesses understandably complain about the cost of borrowing, but restoring price stability after years of monetary expansion was never going to be painless.
There are, however, signs of progress. Official CBN data show headline inflation falling substantially from its earlier highs, although historical comparisons must be treated carefully because Nigeria has since rebased its Consumer Price Index. What matters is that the broader direction has shifted towards disinflation and greater monetary stability.
Cardoso's banking recapitalisation programme is another reform with potentially long-term consequences. The CBN raised minimum capital requirements to ₦500 billion for international commercial banks, ₦200 billion for national banks and ₦50 billion for regional banks, among other categories. The objective is straightforward: Nigeria needs stronger banks capable of absorbing shocks and providing the scale of financing required by a much larger economy.
The reforms have also extended to diaspora remittances, Bureau De Change operations, financial inclusion, digital payments and stronger regulation of the financial system. Individually, these initiatives may not dominate newspaper headlines, but collectively they represent an attempt to rebuild confidence in the machinery of monetary management.
None of this should be interpreted to mean that Cardoso's job is complete.
Macroeconomic stability is not an end in itself. Nigerians cannot eat external reserves, and businesses cannot expand simply because economic indicators are improving. Ultimately, the success of these reforms will be judged by whether lower inflation translates into stronger purchasing power, whether stability attracts productive investment, and whether a stronger banking system finances businesses capable of creating jobs.
That is the next frontier.
But three years into Cardoso's tenure, one conclusion is increasingly difficult to ignore: the Central Bank he inherited and the Central Bank he leads today are markedly different institutions.
The FX backlog has been cleared. Reserves have been rebuilt. The foreign-exchange market is more transparent. Banks have been compelled to strengthen their capital positions. Monetary policy has returned to greater discipline.
Cardoso's first three years have essentially been about restoring credibility and stability to a system that badly needed both.
His ultimate legacy, however, will depend on what comes next — whether that hard-won stability can finally become the foundation for investment, growth, jobs and prosperity that ordinary Nigerians can feel.
That is when monetary reform becomes economic renewal.
Segun Adesemoye is the President of The Yoruba Heritage Group. He writes from Onajin Street, Ondo. He can be reached at yorubaheritage1@gmail.com.