The Central Bank of Nigeria, on Friday, revoked the operating licence of Skye Bank Plc with immediate effect.
The CBN Governor, Godwin Emefiele, disclosed this during a news conference in Lagos.
Emefiele said the decision was reached following the inability of the owners of the bank to shore up the capital of the distressed bank which had earlier received a N350 billion intervention in July 2016.
He said: “Skye Bank requires urgent recapitalisation as it can no longer continue to live on borrowed times with indefinite liquidity support from the CBN.
“We have decided to establish a bridge bank, Polaris Bank, to assume the assets and liabilities of Skye Bank.
“The strategy is for AMCON to capitalise the bridge bank and begin the process of sourcing investors to buy out AMCON.
“By this decision the licence of Skye Bank is hereby revoked.”
Also the management of the distressed Skye Bank would be retained to continue to manage the newly licensed Polaris Bank.
According to the CBN governor, given the good performance of the board and management, the CBN shall retain them.
Also, Emefiele said based on discussion with the Nigerian stock Exchange, the shares of the distressed Skye Bank would be suspended from trading on the capital market until discussions are concluded. The shares had gained 4.05 per cent to reach 77k on Friday.
The CBN took over Skye Bank Nigeria Plc on July 4, 2016.
The action led to the resignation of the Chairman, all Non-Executive Directors on the Board as well as the Managing Director, Deputy Managing Director, and the two longest-serving Executive Directors on the Management Team.
The News Agency of Nigeria reports that with the takeover of the bank by the CBN and the Nigeria Deposit Insurance Corporation 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.
Also, the Managing Director and Chief Executive of Nigerian Deposit Insurance Corporation, Alhaji Umaru Ibrahim, said 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.
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