CBN Sells Polaris Bank For N50b To Strategic Capital Investment Limited
CBN Sells Polaris Bank For N50b To Strategic Capital Investment Limited
After three years of operation as a bridge financial services provider, the Central Bank of Nigeria, CBN, has announced its final decision to sell Polaris Bank Limited to new core investors, Strategic Capital Investment Limited.
ALSO, READ McGriff Names Doug Hodo Chief Strategic Growth Officer
The Asset Management Company of Nigeria and the apex agreed to transfer the bank’s assets to its new investor, according to a statement (AMCON).
The sales were executed through a Share Purchase Agreement (SPA) for Strategic Capital Investment Limited to buy all of Polaris Bank’s ownership.
“Polaris has been operating as a bridge bank since 2018 when the Central Bank of Nigeria intervened to revoke the license of the former Skye Bank Plc and established Polaris Bank to assume its assets and certain liabilities.
CBN Sells Polaris Bank For N50b To Strategic Capital Investment Limited
“As part of the CBN intervention, consideration bonds with a face value of N898 billion (future value of N1.305 trillion) was injected into the bridge bank through AMCON, to be repaid over a 25-year period”.
CBN said these actions were taken to prevent the imminent collapse of the bank, enable its stabilization and recovery, protect depositors’ funds, prevent job losses, and preserve systemic financial stability.
ALSO, READ CBN Raises Interest Rate On Intervention Loans To 9% From 5%
It noted the new core investor has paid an upfront consideration of N50 billion to acquire 100% of the equity of Polaris Bank and has accepted the terms of the agreement which include the full repayment of the sum of N1.305 trillion, being the consideration bonds injected.
The CBN thus received an immediate return for the value it has created in Polaris Bank during the stabilization period, as well as ensuring that all funds originally provided to support the intervention are recovered.
CBN Sells Polaris Bank For N50b To Strategic Capital Investment Limited
The statement reads the sale was coordinated by a Divestment Committee comprising representatives of the CBN and AMCON, and advised by legal and financial consultants.
It added that the Committee conducted a sale process by ‘private treaty, as provided in Section 34(5) of the AMCON Act to avoid negative speculations, retain value and preserve financial system stability.
ALSO, READ Lloyd’s Announces New And Improved London Bridge PCC Vehicle
Commenting on the transaction Mr. Godwin I. Emefiele, Governor of the Central Bank of Nigeria said: “This sale marks the completion of a landmark intervention in a strategic institution in the Nigerian banking sector by the CBN and AMCON.
“We commend the outgoing board and management for their vital role since the bridge bank was established; in stabilizing the Bank’s operations, its balance sheet and implementing strong governance structures to address the issues that led to the intervention.
ALSO, READ Ryan Cohen Sells Entire Stake In Bed Bath & Beyond
“This process has provided the CBN with an unprecedented opportunity to recover its intervention funds in full and promote financial stability and inclusive growth. We wish SCIL well as they implement growth plans to build the bank from the strong foundations that have been established.”
AllInsuranceHUB is a blog for everyone who seeks an informative, educative, and knowledge-based online insurance and investment community. We share Biographies, Top-notch investment tips, finance news, insurance policy details and much more. You can read and share thoughts, ideas, and opinions on the finance market and get real-time updates from around the globe.
