CBN: How 182 financial institutions became insolvent, distressed, others
…includes 154 MfBs, 22 finance coys, 6 PMBs
The Central Bank of Nigeria has concluded all plans to revoke the operating licenses of not less than 182 financial institutions across the country.
The apex bank disclosed that 154 of the affected institutions are microfinance banks; six are primary mortgage banks; while the remaining 22 are finance companies.
The CBN, however, explained that 62 of the microfinance banks had already closed shop, while 74 became insolvent, 12 were terminally distressed and six voluntarily liquidated.
The CBN listed the primary mortgage banks for revocation as Accord Savings and Loans Limited in Lagos that failed to recapitalise; and Ahocol Savings and Loans Limited in Anambra (state government-owned) that closed shop.
Other mortgage banks for revocation are Trans Atlantic Savings and Loans Limited in Bayelsa (state government-owned) that became insolvent; Royal Savings and Loans Limited in Delta State that also closed shop;
Amex Savings and Loans Limited in Lagos that failed to recapitalise; and Supreme Savings and Loans Limited also in Lagos that closed shop.
The CBN Central Bank noted that eight finance companies voluntary liquidated; 13 failed to recapitalise; while one became insolvent.
According to the apex bank, the affected institutions are from different states of the federation.
Just last week, the CBN in collaboration with Nigerian Deposit Insurance Corporation (NDIC), established a bridge bank, Polaris Bank, to assume the assets and liabilities of Skye bank Plc.
Skye bank before now had failed to meet minimum thresholds in critical prudential and adequacy ratios, which culminated in the bank’s permanent presence at the CBN Standing Lending Window on daily basis.
In a statement, The CBN governor, Mr. Godwin Emefiele said, the bank’s performance has improved considerably compared to the pre-July 2016 era.
“The result of our examinations and forensic audit of the bank has, however, revealed that Skye bank requires urgent recapitalisation as it can no longer continue to live on borrowed times with indefinite liquidity support from the CBN.
The shareholders of the bank have been unable to recapitalize it,” he said on Friday.
Emefiele said, “The focus of the action then was to save depositors’ funds and to ensure that the bank continued as a going concern, being a systemically important bank.
“Part of our intention was also to stem the imminent job losses to staff if a liquidation option had been adopted.
“These objectives have been fully achieved and the bank has been able to meet customer obligations, having curtailed the liquidity haemorrhage and restored depositor confidence.”
He assured depositors that under the new management, their deposits remain safe and that normal banking services continued in the new bank on Monday, 24th September, 2018, to enable customers to transact their businesses seamlessly.
“Thus, all customers of Skye Bank shall be automatic customers of the new bank and their accounts and records duly purchased by Polaris Bank”, he maintained.
