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SEC endorses establishment of Bridge Banks

Category: Money Market

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SEC endorses establishment of Bridge Banks



August 07, 2011, 3.08pm
The Securities and Exchange Commission (SEC) wishes to state that the actions of the Nigeria Deposit Insurance Corporation (NDIC), the Central Bank of Nigeria (CBN) and the Asset Management Company of Nigeria (AMCON) are significant steps towards the resolution of the banking crisis. Indeed, the Commission believes these actions will accelerate the recovery of the Nigerian capital market.
Specifically, NDIC in the exercise of its powers under the NDIC Act on 5th August 2011, established Enterprise Bank Limited, Keystone Bank Limited and Mainstreet Bank Limited as Bridge Banks to take over the deposit liabilities and assets of Spring Bank Plc, Bank PHB Plc and Afribank Bank Plc, whose banking licenses have been revoked by CBN.
Subsequently on 6th August, 2011, AMCON in fulfillment of its role as a resolution vehicle and pursuant to the provisions of the AMCON Act of 2010 signed an agreement with each of the three Bridge Banks. The agreements involve the acquisition and transfer of ownership with a promise to provide sufficient capital to restore the banks to the level of capital adequacy stipulated for their operations.
As a consequence of the above actions and to maintain market integrity, the SEC has approved the placement of the shares of Afribank Plc, Bank PHB Plc and Spring Bank Plc on full suspension. Full suspension means that there will be no trading on the shares of the said companies.
The Commission equally notes that in compliance with the CBN requirements for recapitalization, Finbank Plc, Intercontinental Bank Plc, Oceanic Bank Plc and Union Bank Nigeria Plc have executed Transaction Implementation Agreements (TIAs) with core investors. To protect investors, the SEC has approved that the Nigerian Stock Exchange (NSE) should place the shares of these banks on technical suspension. Technical suspension means that trading on the shares can continue without any change in price.
The Commission remains committed to its mandate of investor protection and market development.
For further information / clarification, please contact:
Lanre Oloyi
Head of Media, SEC Nigeria
Plot 272 Samuel Adesujo Ademulegun Street
Central Business District, P.M.B. 315, Garki, Abuja
Tel: +2348055204293 begin_of_the_skype_highlighting +2348055204293 end_of_the_skype_highlighting +2348033228247 begin_of_the_skype_highlighting +2348033228247      end_of_the_skype_highlighting

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