– AMCON to begin purchase of assets in three weeks

 Friday 15 Oct 2010 Reuters

Five or six of the banks rescued in a N620 billion ($4 billion) bailout last year will announce negotiations with potential suitors in the coming weeks, Lamido Sanusi, Central Bank of Nigeria (CBN) Governor, said on Thursday.

Last year, the CBN rescued nine lenders deemed to be so weakly capitalised that they posed a risk to the nation’s economy, and has since been seeking new investors to recapitalise them. “In the next two to three weeks, you will hear announcements from five or six institutions about negotiations on registered acquisitions,” he said at a conference on the power sector in Abuja.

In August, Sanusi said the CBN had received bids for four of the rescued banks and that foreign institutions were involved in the bidding process, as well as several local banks and private equity firms in partnership with foreign banks.

Sanusi also said, on Thursday, that the state Asset Management Corporation (AMCON), set up to purchase non-performing loans and chase the recovery of bad loans, would begin purchasing assets in the next two to three weeks.

“By the end of this year we will have put the banking problems behind us,” Sanusi said. Sanusi told the gathering of over 200 investors that the CBN is set to unlock the over N3 trillion pension fund through the provision of credit enhancement risks for the use of the fund for infrastructure for up to 25 years.

“The CBN is hedging currency and exchange rate risks, but investors will always take the commercial risks”, he said.

Source: Businessday