Posted by By SEUN ADESIDA on
Hope of survival for 13 banks slated for liquidation by mid-January dimmed Wednesday, as the Central Bank of Nigeria (CBN) says there's no going back on their closure. This is even as the affected banks make desperate moves to remain afloat.
Hope of survival for 13 banks slated for liquidation by mid-January dimmed Wednesday, as the Central Bank of Nigeria (CBN) says there's no going back on their closure. This is even as the affected banks make desperate moves to remain afloat.
CBN's image maker, Mr Festus Odoko told Daily Sun that any bank, outside the 25 that met the apex bank's deadline on recapitalization, hoping to stay out of liquidation will not succeed.
According to him, "CBN asked banks to raise their capital base to N25 billion, and a bank says it has N10 billion and its asset will make up for the balance of N25 billion," apparently referring to the defunct Alliance Group.
Odoko said that CBN does not accept asset in place of cash deposit for the capital base of a bank, wondering how the banks hope to make N15 billion before the liquidation hammer falls.
When asked about frantic efforts banks are making to escape liquidation, he rhetorically asked, "what were they waiting for? What they could not get in 18 months? How can they now get it?" He said that the banks' fate had been determined.
Asked specifically about Trade Bank and Hallmark Bank, Odoko said, "let's wait and see the miracle they want to perform."
After the CBN released names of the 25 banks that were able to raise their capital base to N25 billion and 13 banks that did not make the mark, some of the unlucky banks have been intensifying moves to ensure that they escape liquidation.
The moves, according to Daily Sun source, have been orchestrated by core investors in some of the banks, who still hope to salvage the situation and their investment.
As at the time of going to press, Trade Bank Nigeria Plc, one of the banks slated for liquidation, said it was doing everything possible to improve its capital base and head back into the group, where it ran out from. Disproportionate share exchange rate had forced them out of the Afribank Group. The share exchange rate was put at unit of Afribank share for 40 units of Trade Bank shares, a situation which was not acceptable to the bank.
Trade Bank ran into the Alliance Group, but failed to scale the consolidation hurdle along with other members of the group.
African Continental Bank (ACB) says it has been readmitted into the Spring Bank. The group had, at the last minute, dropped ACB, but a source in ACB insisted that they are heading back into the group, as it was last minute differences in their positions that led to collapse of the merger plans.
Hallmark Bank, insists that they will make the required capital base as soon as the funds they are expecting arrives and is verified by the CBN.