October 07, 2005/Source The Guardian
Another group of three banks have pulled their resources together to cross the recapitalisation hurdle. They are Investment Banking and Trust Company (IBTC), Chartered Bank Plc and Regent Bank Plc.
The three banks, which will operate as IBTC Chartered Bank Plc, may today seek the approval of the Central Bank of Nigeria (CBN) for their re-alignment.
When the group takes off, the shareholders\' fund will stand at N33.5 billion, total asset base N125 billion and it will have a network of 60 branches nation-wide.
The Guardian learnt that IBTC is entering the group with shareholders\' funds of N22 billion. Chartered Bank also comes into the deal with N10 billion while Regent Banks is contributing N1.5 billion in shareholders fund.
A peep into the merger efforts of the three banks share that IBTC had planned to merge with Bond Bank but the alliance failed.
Similarly, Chartered Bank and Regent Bank were into talks with Ecobank Nigeria Plc but with a partnership between First Bank Nigeria Plc and Ecobank Group sealed, Regent Bank and Chartered Bank had to seek greener pastures elsewhere.
The IBTC Chartered Bank Plc merger marks the latest re-alignment groups in the ongoing consolidation programme.
Already, the CBN is taking steps to wind up the recapitalisation programme.
On Tuesday, the CBN and the Securities and Exchange Commission (SEC) gave a deadline that expired yesterday for all issuing houses, receiving banks to transfer all subscription monies yet to be verified by the two regulatory authorities to the apex bank\'s Escrow Account.
The regulatory agencies had on September 18, 2005 given the banks 12 days to end all new capital issues.
The capital market has remained the most viable avenue for banks sourcing of funds to meet the N25 billion minimum capital base.
In a statement signed by the Head of Corporate Affairs of SEC, Mr. Ismail Mohammed on Tuesday, the agencies explained that \"their position was borne out of the fact that the joint SEC and CBN circular on time out for banks\' offer ended on September 30, 2005.
\"This has therefore given rise to the urgent need to ensure that investors\' monies are safe-guarded in the on-going banks\' consolidation process.
\"Evidence of compliance with this directive is to be filed with the commission not later than two days after it is affected.\"
Giving weight to the directive, a CBN official remarked that \"it is true. This is because it will not be safe for investors\' funds to be in those banks.
\"We want the funds to be held in an escrow account, so that if the banks do not make it, the investors can get their monies back.
\"Such banks might not be able to complete necessary capital verification concerning new issues before the end of 2005,\" he said.
Besides, barring new offers by banks that intend to meet the N25 billion mark, the CBN and SEC had also set October 31 as deadline for the conclusion of all merger arrangements by those yet to do so.