The Central Bank of Nigeria, CBN said on Thursday some commercial banks have violated its regulatory limit of foreign currency borrowings, due to the recent fall in the value of the Naira.

To remedy this, the CBN has increased the limit on banks' foreign currency borrowings to 125% of shareholders’ funds.

The new regulation replaces a 2014 rule capping foreign borrowings, including Eurobonds, at 75% shareholders' funds.

"A major consequence of this development was the inadvertent breach of the regulatory limit for foreign currency borrowings by some banks," CBN said in a circular.

"To address this development ... the aggregate foreign currency borrowing of a bank borrowing should not exceed 125% of shareholders' funds," the circular added.

The new rules also prescribe that all foreign borrowing should be hedged through the financial markets and debt should have a minimum of five-year maturity except for trade lines.

It directed banks to report on their utilisation of foreign currency borrowings on a monthly basis.