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HomeAfricaNigeria's apex bank to liquidate undercapitalised banks by October

Nigeria’s apex bank to liquidate undercapitalised banks by October

The Central Bank of Nigeria (CBN) on Monday said any of the nine rescued banks that failed to recapitalize by 30 October, 2011, would have its licence revoked and handed over to the Nigeria Deposit Insurance Corporation (NDIC) for liquidation.

Governor of the CBN , Mr. Sanusi Lamido Sanusi, told journalists here at a meeting of stakeholders with the board of directors, management and shareholders of the rescued banks that “by 30 September, we will withdraw our inter-bank guarantees for the rescued banks and we will pull the planks and hand them over to the NDIC for liquidation.’’

The rescued banks include Union Bank, Intercontinental Bank, Finbank, Afribank, Oceanic Bank, Bank PHB, Equatorial Trust Bank, Spring Bank and Wema Bank.

Though Sanusi noted that some of the rescued banks had recorded milestones in their merger and acquisition procedures, some were still very far away in consummating the processes that could lead to their recapitalization, pointing out that the apex bank could not just allow an open-ended process.

According to him, “by September 30, it will be over two years since we intervened in these banks. And the CBN has allowed the shareholders and directors of these banks to pursue their recapitalization by looking for their own partners. But some of these directors and shareholders are not cooperating.

“We introduced AMCON to inject capital to these banks but some directors are averse to this. Then we asked them to look for partners, yet some of them are not cooperating. We cannot continue like this. Now, what is left for them is to either write a cheque for us or allow AMCON inject liquidity.’’  

The CBN had in October last year warned owners of the troubled banks to recapitalise or be ready to face liquidation in line with laid down regulations.

The apex bank said liquidation and nationalisation are not desired options as it was convinced that fresh injection of capital through strategic partnership remain the best approach to quickly get these banks to safe haven

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