Though faced with decreasing profits and rising bad debts, banks in  The Gambia are required to increase their minimum capital to D200 million by end-December 2012.
Starting in 2008 on the heels of a directive by Central Bank of The Gambia, the capital increment is the second and final phase of recapitalisation, which promises to enhance the safety and soundness of the country’s banking system.
The initial recapitilisation saw banks increase minimum capital at Central Bank from D60 million to D150 million by end-December 2010, but not without controversy.
Eight of the fourteen banks, then, were able to increase their capital requirement on time, whilst five of the six remaining banks did so when threatened with revocation of their banking licenses.
At last, all the banks, except Oceanic Bank (The Gambia) Limited, met the requirement for December 2010. Oceanic defaulted because its parent company, Oceanic Bank International Plc in Nigeria, divested from all international subsidiaries, forcing the closure of The Gambia subsidiary.  
Mr Ousman Barrow, a financial analysts has infact noted that most of the banks were able to meet their minimum capital requirement thanks to the support of their parent companies.
The recapitalisation in 2012 is coming at a time when commercial banks in the country are undergoing some turbulent times in the face of drops in profits while non-performing loans increase.
“With 13 banks competing for a small customer base, competition is fierce resulting in narrow profit margins,” the recently published IMF Country Report on The Gambia has pointed out.
Yet they are expected to adjust their minimum capital at the Central Bank from D150 million to D200 million by end of this year as Central Bank, as in 2010, has resolved not to grant request for forbearance if a bank fails to meet the requirement.  
As the bank of the banks, Central Bank of The Gambia has the powers to revoke the banking licenses of defaulting banks. And to mitigate systemic risk that may arise from the revocation of a banking license, the CBG could invoke section 45 of the Banking Act 2009 and take over the bank; and could further invoke Sections 48 and 51 of the Banking Act 2009 and place the institution in conservatorship to be sold, merged or restructured; and apply to the High Court for compulsory liquidation under Section 52 of the Banking Act as a last resort.