Socialize

CBN injects 786bn (approx.US$2.75bn, Le22 trillion) in Skye Bank as Polaris takes over

 September 24, 2018

CNB

CBN Governor Godwin Emefiele

Central Bank of Nigeria (CBN) Governor and Managing Director of the Nigeria Insurance Deposit Corporation (NDIC), Godwin Emefiele, disclosed on Friday at a media briefing in Lagos change in the name of Skye Bank to Polaris Bank, which has taken over Skye Bank.

He said N786 billion has been injected into the bank, with Asset Management Corporation of Nigeria (AMCON) directed to commence the sale process of the bank beginning this Monday.

Mr Emefiele added that the strategy is for AMCON to capitalise the bridge bank and begin the process of sourcing investors to buy out AMCON.

“By this decision, the licence of the defunct Skye Bank is hereby revoked,” he said, adding that “all customers of Skye Bank shall be automatic customers of the new bank and their accounts and records duly purchased by Polaris Bank.”

The CBN governor explained, however, that given the good performance of the board and management of the bank, the CBN shall retain them. In addition, he said, all employees of Skye Bank shall be absorbed by Polaris Bank under a new contract, except any employee decides to opt out.

Mr. Emefiele added that the strategy is for AMCON to capitalise the bridge bank and begin the process of sourcing investors to buy out AMCON.

“By this decision, the licence of the defunct Skye Bank is hereby revoked,” he said, adding that “all customers of Skye Bank shall be automatic customers of the new bank and their accounts and records duly purchased by Polaris Bank.”

The CBN governor explained however that given the good performance of the board and management of the bank, the CBN shall retain them. In addition, he said, all employees of Skye Bank shall be absorbed by Polaris Bank under a new contract except any employee decides to opt out.

He added that although the bank’s performance improved afterwards, the bank needs urgent recapitalisation.

“The result of our examinations and forensic audit of the bank revealed that the Skye Bank requires urgent recapitalisation as it can no longer continue to live on borrowed times with indefinite liquidity support from the CBN,” he said.

“We wish to assure all depositors that under this arrangement, their deposits shall remain safe and that normal banking services shall continue in the new bank on Monday, 24th September 2018, to ensure customers to transact their businesses seamlessly.”

The revocation of Skye Bank’s operating licence follows the Central Bank’s decision to pause its injection of funds processes in the lender. The regulators maintain that customers’ deposits are safe as management and members of staff will be retained under the new ownership structure.

Meanwhile, the share price of Skye Bank on Friday gained 4.05 percent at 77 kobo. The stock is expected to be placed on suspension from Monday in accordance with bridge bank procedures.