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Stanbic, Fidelity to Acquire Uncapitalised Bank


January 05, 2006/Thisday




Indications emerged in Lagos yesterday that some of the 25 banks that have been cleared by the Central Bank of Nigeria (CBN) to operate banking services in Nigeria have begun to make moves to cherry pick from among the 15 banks which failed to meet the N25 billion capital regime and listed by the apex bank for liquidation.

It was gathered yesterday that Stanbic Bank, a subsidiary of Standard Bank of South Africa, has indicated interest in acquiring about five banks out of the 15 open for acquisition as it seeks to expand its branch network and market share.

According to information, the bank may have also engaged the services of the accounting firm of KPMG, which is expected to advice it as well as carry out necessary due diligence on the five banks that can give over 100 new branches. Stanbic is said to be looking at Liberty, SGBN, Metropo-litan, Triumph and All States.

The bank is also said to have already started working out the details of its acquisition move with the apex bank.

Newly recapitalised Stanbic with deep pockets and ambitions in Nigerian banking landscape is looking at increasing its branches in Nigeria to between 100 and 120 and thus would be interested in any of the affected banks with high branch network.

In the case of Fidelity Bank, indications also emerged yesterday that the bank which is also one of the 25 consolidated banks approved by the CBN, has indicated interest in ACB.

Fidelity Bank had made a bid for the acquisition of ACB in August last year but the owners of ACB at the time were said to be undecided, despite what insiders considered an excellent proposal presented by Fidelity for turning around ACB. 

Fidelity then moved on to consolidate with the former FSB International Bank Plc and Manny Bank Plc to form the enlarged Fidelity Bank Plc.

The apex bank in a letter titled “Expression of Interest in the Undercapitalised Banks,” the CBN memo, listed the 15 banks slated for liquidation and advised the 25 banks that had scaled through the N25 billion minimum capital requirement, to indicate interest in acquiring them.

Signed by one Mr. David Gana on behalf of the CBN Director, Banking Super-vision,  the memo dated January 3, 2006 with reference BSD/BAN CONS/-VOL.7/34 reads: “Follo-wing the conclusion of the first phase of the banking industry consolidation programme as announced by the Central Bank of Nigeria on January 2, 2006, the 25 banks that have been cleared are hereby invited to indicate their interest in acquiring any of the underlisted banks: Liberty Bank, Fortune Bank, City Express Bank, Triumph Bank, Metropolitan Bank, Gulf Bank, Afex Bank, Eagle Bank, Allstates Trust Bank, Assurance Bank, Hallmark Bank, Trade Bank, Societe Generale Bank (SGBN), Lead Bank and African Continental Bank (ACB).

“Please note that your interest in acquiring the bank(s) should be without any condition to the CBN. You may not at this point be allowed to take up selected assets and/or liabilities.

“Your response should reach the Director of Banking Supervision, Central Bank of Nigeria before the close of business on January 6, 2006, please.”

Meanwhile, for the second consecutive day, virtually all the under-capitalised banks slated for liquidation by the Central Bank of Nigeria (CBN) opened their respective head offices in Lagos for the usual skeletal businesses yesterday.

It was, however, a waiting game for customers of these banks at their respective branches in Lagos and Abuja.

Our correspondents who went round some of the affected banks yesterday in Abuja reported that most of them did not transact business while most of their counterparts in Lagos conducting skeletal services.

A survey of Lagos showed that at the Allstates Trust Bank head office branch in Victoria Island, business transactions were paralysed with very few staff on duty. Officials later told THISDAY that the bank had stopped payment to customers for over a week ago.

At Metropolitan Bank head office branch also in Victoria Island, business was going on as usual while an official of the bank said that there had not been any official directive to stop payment. 

One of the customers who spoke to our correspondent said he was highly impressed that the bank opened to customers. \"I was scared of getting my money, but when I got to the bank, I was surprised that payment was going on, in fact I am highly impressed with the bank\", he said.

One of the officers in the bank said, \"you can see, we are still attending to customers, irrespective of the present circumstances even though the situation is still hazy, we are doing business as usual\".

But at the Ojuelegba Road branch of Metropolitan Bank, the bank was deserted while two police officers and a uniformed private security officer were stationed in front of the entrance to the bank which was under lock. The security operatives around the bank, however, wore gloomy faces.

At Trade Bank’s head office in Marina was opened for normal business. Customers, however, gathered in groups to discuss the fate awaiting the bank. One of the customers said; \"We heard that they paid yesterday (Tuesday), so we rushed down here waiting to be attended to also.\"

On inquiries, a cashier on duty was heard telling customers to \"please come tomorrow, our Treasury officers have gone to the CBN so check tomorrow.\"

Hallmark Bank also opened for business, and witnessed a fairly large turnout of customers who pressed for the withdrawal of their deposits.

Said one agitated customer: \"We heard that they paid yesterday Tuesday. The cashier asked us to wait, may be we will get our money. I heard the CBN said they will pay us in three months, I cannot wait because I need my money now.\"

At Afex Bank on Broad Street, the office was deserted as there was no single staff on duty and the banking hall was absolutely empty with only two mobile policemen and a plain cloth security man on standby. Agitated customers were also seen shouting at the security personnel demanding to be paid.

However, at ACB International, Broad Street, normal banking business was on as customers were seen depositing and withdrawing money.

The reverse was, however, the case at Eagle and Triumph Banks, where checks showed that there were no customers present at the banking premises.

In Ikeja, Eagle Bank and Liberty Bank branches opened their doors, but they were, however, deserted by the customers who from investigation were fully aware that these banks failed the recapitalisation hurdle.

However, at some of the banks that scaled through, it was business as  usual as queues of customers were  the order of the day. 

“I thank God that my bank is one of the big ones that have consolidated its stand in the sector. So I am now assured of continuing transactions with the bank,\'\' a lady spotted on the queue at the Union Bank, Garki, Abuja said.

Although the customers in such banks were happy with the status of their banks, they, however, lamented over the long hours spent on transactions.

“We are calling on the consolidated banks to pay attention to real time banking and find a solution to this queues and delays in making withdrawals,\'\' another customer, Mrs. Vivian George said.

The customers further urged the consolidated banks to enhance banking services in the country by carrying out flawless services.

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