News
AMCON Rebrands Nationalised
Banks
As bank customers and the public gradually get used to the fact
that Afribank Plc, Bank PHB Plc and Spring Bank Plc have ceased
to exist as banks and going concerns, the Asset Management
Company of Nigeria (AMCON) has rebranded the three bridge banks
it acquired from the Nigeria Deposit Insurance Corporation (NDIC)
on Saturday.
The Securities and Exchange Commission (SEC) has, in the
meantime, suspended trading in the shares of the nationalised
banks indefinitely while AMCON has appointed new boards and CEOs
for the three financial institutions.
Following the failure of the shareholders, boards and management
to recapitalise Afribank, Bank PHB and Spring Bank, the Central
Bank of Nigeria (CBN) withdrew the licences of the three banks
last Friday and handed them over to NDIC.
NDIC, in turn, created bridge banks as temporary holding
companies to assume the assets and liabilities of the failed
banks while facilitating their resolution.
The three bridge banks that emerged from the carcasses of
Afribank, Bank PHB, and Spring Bank were Mainstreet Bank,
Keystone
Bank and Enterprise Bank respectively, which were then acquired
by AMCON in a formal ceremony after the execution of a
subscription agreement that will enable AMCON to inject N678
billion into the new banks.
With the banks’ acquisition, Mainstreet, Keystone and Enterprise
Banks will open for business today to their customers under new
chief executives and management teams.
Providing further insight into their acquisition, the Managing
Director/CEO of AMCON, Mr. Mustafa Chike-Obi, informed THISDAY
that it was important for the public and customers to understand
that what AMCON acquired from NDIC were the bridge banks and not
Afribank, Bank PHB and Spring Bank whose licences had already
been revoked.
He said customers’ deposits in the three new banks remained safe
and there was no reason for panic withdrawals, since all their
assets and liabilities had been assumed by the bridge banks,
which were sold to AMCON.
“Mainstreet, Keystone and Enterprise Banks are going concerns
and have banking licences to operate, so no money will be lost.
AMCON shall retain ownership of the three new banks for three
years until new owners are found for them to take them over,” he
stated.
In this stead, an official of CBN confirmed that AMCON had
commenced the rebranding of the three banks, which started last
weekend with the change of name plates at their head offices and
24 of their branches in some major cities nationwide.
He disclosed that the banks’ major branches had already been
rebranded in Lagos, Kano, Kaduna, Aba and Port Harcourt, adding
that the change of their name plates would continue in the weeks
ahead.
The official explained that rebranding was necessary to put a
stamp of finality on the defunct banks, and that the exercise
would include the rebranding of cheque books, letterheads and
other official documents of the new banks that had risen from
their ashes.
The CEOs will be required to meet with key stakeholders and bank
customers to allay concerns over their deposits and the safety
of the banks.
The new boards and managements, each having seven individuals as
members, are chaired by Mr. Moyo Jacob Ajekigbe (Keystone),
Malam Falalu Bello (Mainstreet) and Mr. Emeka Onwuka
(Enterprise).
All the three are former bank CEOs: Ajekigbe (FirstBank), Bello
(Unity Bank) and Onwuka (Diamond Bank).
AMCON said the boards and managements of the three banks had
been approved by the CBN.
Keystone has Mr. Oti Ikomi as Managing Director and Mr. Shehu
Abubakar, Mr. Demola Adewale, Mrs. Yvonne Isichei, Dr. Shehu K.
Mohammed and Mr Raphael Ereyi as Executive Directors.
Mainstreet has Mrs. Faith Tuedor-Matthews, who recently resigned
as the Deputy Managing Director of United Bank for Africa (UBA)
Plc, as Managing Director. She will be supported by Mr. Kola
Ayeye, Mr. Abubakar Sadiq Bello, Mr. Bolaji Shenjobi, Mr. Anogwi
Anyanwu and Mr. Roger Woodbridge as Executive Directors.
For Enterprise Bank, Mr. Ahmed Kuru is the Managing Director,
while Mrs Louisa Olalokun, Mrs Nneka Onyeali-Ikpe, Mr. Aminu
Ismail, Mr. Niyi Adebayo and Mr. Audu Kazir are Executive
Directors.
AMCON said: “The newly appointed boards are entrusted with the
mandate to manage these banks along best commercial practice to
compete effectively in the Nigerian banking sector and provide
quality service to customers.”
AMCON also disclosed that the CBN had granted the same interbank
guarantee it extended to the banks that had signed Transaction
Implementation Agreements (TIAs) until December 31, 2011.
The corporation assured Nigerians that the banks were fully
capitalised, strengthened and well positioned for future growth.
It said: “Depositors are again assured that their deposits are
safe, and employees are also assured of seamless continuity of
business operations and job functions.”
SEC said yesterday that it had suspended trading in the shares
of Afribank, Spring Bank and Bank PHB, following their
nationalisation.
SEC also approved a technical suspension on the trading of
Finbank, Intercontinental, Oceanic Bank and Union Bank shares,
pending the completion of agreed recapitalisation deals,
according to a Reuters report.
A technical suspension means that trading on the shares can
continue without any change in price.
Following the outcome of an industry-wide special audit
undertaken by CBN and NDIC in 2009, the CBN had intervened in
eight banks and sacked their CEOs and executive directors.
The banks were discovered to have been mismanaged by their
boards and management, resulting in negative shareholders’ funds
and inadequate liquidity.
In a bid to save them, CBN injected N620 billion in the form of
Tier II capital and provided interbank credit guarantees to
enable them to remain in business. CBN also appointed interim
CEOs and executive management teams for the eight banks.
The affected banks were: Oceanic Bank International Plc, Union
Bank of Nigeria Plc, Finbank Plc, Afribank, Bank PHB, Equatorial
Bank Limited, Intercontinental Bank Plc and Spring Bank Plc. Two
other banks – Wema Bank Plc and Unity Bank Plc – were given
timeframes within which their shareholders and management were
expected to recapitalise them.
As the dust settled, the eight banks were required to
recapitalise through CBN-supervised sales to new investors that
would have injected capital into the institutions.
But the effort to sell some of the banks to new owners was
blocked by shareholders and some of their sacked CEOs who
instituted court cases to frustrate the CBN.
Even after the cases were dismissed by the courts for lack of
merit, some bank boards, especially that of Afribank, proved
recalcitrant and made what was considered to be costly mistakes
of rejecting two bids from Vine Capital, a private equity firm,
and Fidelity Bank Plc.
CBN then gave the banks till September 30 to wrap their
recapitalisation with prospective bidders, failing which they
would be liquidated or nationalised.
This galvanised the boards of Finbank, Intercontinental, Oceanic
and Union Banks to speed up negotiations on their acquisition,
thus paving the way for the execution of binding TIAs with
bidders for their banks.
However, Afribank, Bank PHB and Spring Bank, which failed to
heed CBN’s warning, lost their licences to operate as banks and
were handed over to NDIC last Friday. ThisDay
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