Godwin Emefiele, Nigerian Central Bank Governor
The Nigerian Central Bank on Friday announced the immediate revocation of the banking licence of Skye Bank Plc and the set-up of a new bridge bank, Polaris Bank has taken over the banks management.
By the announcement by the Governor of the Nigerian Central Bank, Polaris Bank has taken over the assets and liabilities of the defunct Skye Bank.
Governor of Nigerian Central Bank, Godwin Emefiele, made the new position public during a press briefing in Lagos on 21/8/2019.
Emefiele said the decisions to revoke the Skye Bank Licence and adopt the bridge bank approach in managing the bank as a going concern, was reached following the inability of the owners of Skye bank to shore up the capital of the distressed bank which had earlier received a N350 billion intervention from the Central Bank in July 2016.
Polaris is a bridge bank set up jointly, by the sector regulators comprising the CBN, NDIC and AMCON. According to Emefiele, the bridge bank, Polaris Bank will be getting a single digit interest long term facility of N786 billion from the Assets Management Corporation of Nigeria (AMCON).
Surprisingly, the winding up of the Skye Bank came 5 months after the CBN renewed the mandate of the Interim Management board (IMB) of the bank which was appointed in 2016 to turn around the bank for an additional two years.
The CBN governor, who passed a vote of confidence on the IMB comprising Mr Muhammad Ahmad and Mr Tokunbo Abiru, Chairman and Group Managing Director respectively said the IMB will continue to run the new bridge bank.
“In the two years of the board’s mandate, the team has stabilised the institution, entrenched sound corporate governance and risk management practices, and restored depositors’ confidence.
“In recognition of the stellar performance of the board, the CBN has renewed the Board’s mandate for an additional two-year term till 30th June, 2020.
“We wish to assure the Bank’s shareholders and stakeholders of the commitment of its board and Management, working with the CBN, to conclude various initiatives to achieve a positive turn around for the bank and deliver value to its stakeholders.”
According to Alhaji Umaru Ibrahim, the Managing Director and Chief Executive of Nigerian Deposit Insurance Corporation (NDIC), the option of a bridge bank was to ensure that the depositors of the bank are taken care of and deposits are not lost.
Ibrahim said that the bridge bank would also ensure that there would be no job losses as Polaris Bank would retain all staff of the distressed bank under a new contract.