By Ademola Alawiye

Deposit Money Banks in the “rescued” category that have not signed Memoranda of Understanding with core investors are fast-tracking the process to hedge against post-election uncertainties, investigation by our correspondent has revealed.

Our correspondent gathered from sources close to the deals that the remaining banks would sign the agreements before the end of the current administration.

A top source in one of the rescued banks, who asked not to be named, because he was not authorised to comment on such issues, told our correspondent that the banks were trying to ensure that the deals were taken to irreversible points before the elections.

He said, “There are too many vested interests in the recapitalisation process. They are using all powers they have so as to get control of the banks. The whole process is being fast-tracked because of the uncertainty that may arise in the post- election period. These people are powerful enough to change people directing the recapitalisation process.”

The Governor, Central Bank of Nigeria, Mr. Lamido Sanusi, said last week that three of the rescued banks would announce new investors in their recapitalisation deals soon.

Reuters had quoted Sanusi as saying, “Three of the nine Nigerian banks rescued in a $4bn bail-out in 2009 will announce recapitalisation deals with new investors in the coming days. One of the banks is expected to make an announcement on Thursday, the second on Monday and the third on Wednesday.”

Some rescued banks had been holding talks with potential investors in recent months.

The banks are Intercontinental Bank Plc, Oceanic Bank International Plc, Afribank Plc, Union Bank of Nigeria Plc, Bank PHB Plc, Finbank Plc, Spring Bank Plc and Wema Bank Plc among others.

The Board of Directors of Union Bank, last week, announced that it had signed a Memorandum of Agreement with the African Capital Alliance Consortium to invest $750m in the bank.

Our correspondent also gathered that Access Bank Plc and Intercontinental Bank had also signed an MoU.

This is sequel to the earlier announcement that the bank had entered into negotiation with a core investor. 

According to a statement by Union Bank, the MOA will in the main, provide a framework for the process by which the bank will be recapitalised. 

The entire process will, however, be subject to the approval of the bank’s shareholders, the CBN, the Securities and Exchange Commission, the Nigerian Stock Exchange, and the Federal High Court. 

 

Source: Punch