By Stanley Opara with agency report

Tuesday, 22 Feb 2011

Two United States’ banks are considering opening offices in Nigeria, the Finance Minister, Mr. Olusegun Aganga, has said.

This, he said, was part of a “big wave of investors” planning to move into the country’s financial sector.

Bloomberg quoted Aganga, in an interview in Abuja, as saying, “I’ve spoken to two US banks that are considering setting up here. One of them is at a more advanced stage than the other.” He declined to name either of the institutions.

Nigeria has been looking for foreign investors in the financial industry after the Central Bank of Nigeria was forced to bail out the banking system in 2009,when equity investors failed to pay back loans.

Four of the nine Deposit Money Banks rescued in the $4bn bail-out two years ago, according to the CBN Governor, Mr. Lamido Sanusi, are expected to sign agreements with new investors over recapitalisation this month.

The apex bank had since sought new investors to recapitalise them and set up Asset Management Corporation of Nigeria to help in the process by absorbing their bad loans.

Sanusi said, “In the next four weeks, we expect four of them to sign memoranda of understanding with their new investors,” adding that two of them were expected to conclude negotiations in the next two weeks.

Afribank, Bank PHB, Finbank, Intercontinental Bank, Oceanic Bank and Union Bank have all held talks with potential investors in recent months.

Some of the banks could end up downscaling to become regional banks, which have lower minimum capital requirements than national or international players, bankers have said.

The rescued banks also include privately-held Equitorial Trust Bank, Spring Bank and Wema Bank, which has already said it will restructure into a regional bank.

The Managing Director, AMCON, Mr. Mustapha Chike-Obi, has said the banking crisis would be resolved by the middle of 2011.

Chike-Obi said AMCON was on track to absorb bad loans by the end of March and resolve the banking crisis by the end of June.

 

Source: Punch