In a released made available to the public, the Central Bank
of Nigeria (CBN) has made known its intention to revoke the operating licences
of 182 financial institutions operating in the country.
CBN announced this barely a week after its revoke Skye
Bank’s operating license.
The 182 financial institutions which according to the apex
bank, cut across different states of the country include – 154 microfinance
banks; 6 primary mortgage banks, and 22 finance companies.
CBN said 62 of the microfinance banks had already closed
shops; 74 became insolvent; 12 were terminally distressed; while 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 disclosed that eight finance companies voluntary
liquidated; 13 failed to recapitalise; while one became insolvent.
CBN had revoked the operating license of Skye Bank Plc with
immediate effect. The Governor of the apex bank, Godwin Emefiele, disclosed
this during a press briefing in Lagos.
On why the takeover of Skye Bank was inevitable, CBN in a released
statement said it’s noted that the result of its examinations and forensic
audit of the bank revealed that the bank required urgent recapitalization, as
it could no longer continue to live on borrowed times with indefinite liquidity
support from the CBN. Shareholders were, however, unable to recapitalize it.
In consultation with the Nigerian Deposit Insurance
Corporation (NDIC), it had decided to create a bridge bank Polaris Bank which
the Asset Management Company of Nigeria (AMCON) will recapitalize. AMCON will
then sell its stake in the bank.
