CBN sacks Skye Bank board over N700bn NPLs

… Shareholders express concern

Niyi Olaoye

Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefelie has announced the dissolution of the board and management cadres of Skye Bank of Nigeria Plc by the apex bank over an estimated non-performing loan portfolio of N700bn, which is due to an overexposure in the oil and gas sector.

The governor who revealed this at a press conference in Lagos said that Alhaji M. K. Ahmad, a seasoned public sector executive with over 35 years of experience spanning the public sector and the financial services industry will become the chairman and while Mr. Adetokunbo Abiru would be the new Managing Director.

He however, reiterated that Skye Bank is not in distress and remains a healthy bank in the system.

The CBN boss assured depositors, shareholders and all relevant stakeholders that there was no reason for concern or panic as it’s seek their continued cooperation at this time

Business247 notes that the CBN took the decision as Skye Bank has been deemed ‘unhealthy’ and the measure taken is to prevent a total collapse of the bank.

All the directors and executives at the bank except three executives who joined the bank last year have been shown the door.

But earlier in the day, the Managing Director and some top management of Skye Bank of Nigeria had resigned in anticipation of the planned dissolution of the board and management cadres by the CBN.

Managing Director of Skye Bank, Timothy Oguntayo has already dropped his resignation. The bank would be taken over by CBN and possibly handed over to the Asset Management Company of Nigeria (AMCON).

Business247 gathered that AMCON would buy up the bank’s toxic loan and then make efforts to recover them from the bank’s chronic debtors.

Meanwhile, some shareholders in the banking sector have urged President Muhammadu Buhari to stop the Central Bank of Nigeria (CBN) from forcefully winding up some banks in the country.

The group, in a press statement issued in Lagos and signed by one Johnson Biboye, also urged the President to prevail on the CBN Governor to withdraw a letter addressed to 11 banks, including Skye Bank Plc compelling them to bring ‘insider related credits’ before December 31, describing it as anti-people’s policy.

This, they said would throw the country into economic instability should the apex bank be allowed to go ahead with its planned directive as the plan was nothing but to take-over the 11 banks.

The CBN had in a letter dated January 22 and signed by its Director of Banking Supervision, Benjamin Fakunle asked the banks to bring 10 per cent of their paid-up capital per director before December 31.

The letter reads: “The Central Bank of Nigeria has granted an extension of time till December 31, 20 I6 to enable you bring your insider related credits within the stipulated regulatory maximum of 10% of your Paid-up Capital per director including his/her related parties and 60% Paid-up Capital for total related credits in line with our circular BSD/9/2004 on Large Exposures and Connected Lending. You are however required to provide quarterly report/update on the progress made.”

According to the group, six months before the expiration of its directive, the CBN sacked Skye Bank management.

The group thereby asked the President to remove the CBN Governor, Emefiele, describing his policy as anti-people.

The statement reads “Your Excellency, we are saddened as Nigerians that recent economic policies being released by the Central Bank Governor, (CBN), Mr. Godwin Emefiele, are not only anti-people, anti-economic development but also anti-progressive. It is very important to let you know of the ongoing harassment/intimidation of Chairmen of banks including their Managing Directors and Chief Executives.

“This, Your Excellency, should be aware, is a well-orchestrated plot by enemies of your government to use the Central Bank Governor, Mr. Godwin Emefiele, to systematically collapse the nation’s economy, so that global watchers could make mockery of your government and finally turn Nigeria to a laughing stock locally and internationally.”