AMCON Seek Advisers On Selling Mainstreet, Enterprise, Keystone Banks

The Chief Executive Officer of Asset Management Company (AMCON), Mustapha Chike-Obi

The Asset Management Company of Nigeria (AMCON) has announced that it will appoint financial advisers by June 15 to manage the sale of Mainstreet Bank, Enterprise Bank and Keystone Bank.

The three banks were nationalised in 2011 following mismanagement of bad loans and recapitalised by AMCON.

AMCON’s Chief Executive Officer, Mustapha Chike-Obi, made this known on Thursday in an interview where he revealed plans to sell 100 percent of each of the bank.

He however added that AMCON is yet to decide on the best way to proceed.

“We have advertised for a financial adviser who will take charge of the process” said Chike-Obi.

He said the advisers would solicit expressions of interest from prospective investors.

Mr Chike-Obi said he expected strong interest in the three banks from local and foreign institutions, pointing out that South Africa’s leading bank, FirstRand, had informed AMCON of an interest in acquiring Keystone bank.

FirstRand CEO Sizwe Nxasana told Reuters last week that the South African lender was keen on buying either Keystone or Mainstreet.

Skye Bank is also expected to bid for one of the three banks, depending on valuations, its CEO Kehinde Durosimi-Etti told a shareholder meeting last week, where management sought approval to raise N50 billion.

AMCON said last week it expected to complete the sales by the third quarter of 2014.

 

S.Africa’s FirstRand eyes retail banking in Nigeria – CEO

South Africa’s FirstRand will use Thursday’s launch of its new merchant banking business in Nigeria as a springboard to move into retail and commercial lending in Africa’s second biggest economy, the bank’s chief said.

South Africa’s number two lender won Nigeria’s first merchant banking license in more than a decade last November and opened its doors in Lagos on Thursday.

Now it wants to expand its operations in Nigeria, organically or through an acquisition, First Rand Chief Executive Sizwe Nxasana told Reuters in Lagos during the launch of Rand Merchant Bank (RMB) Nigeria.

“We are looking at having a universal banking operation in Nigeria … growing on the back of our investment banking operations into the retail and commercial banking,” he said.

“Our appetite for Nigeria is growing and we are going to be looking at opportunities that will put us in a position where we are becoming a seeded player … in other words among the top five banks in Nigeria in the next few years.”

FirstRand has been looking for an entry into Africa’s most populous country for years. It ended talks last year to buy a majority stake in Nigeria’s Sterling Bank after they both failed to agree on price.

Nxasana said FirstRand was still interested in acquiring one of the three banks, Mainstreet Bank, Keystone Bank and Enterprise Bank that were nationalised two years ago, but could also enter retail operations on its own.

FirstRand in November had said it could spend more than $300 million to buy a retail and commercial bank in Nigeria.

Banks To Stop N100 ATM Charges Next Monday

The Bankers’ Committee on Sunday said the decision earlier reached to suspend all charges accruing from the use of Automated Teller Machines (ATMs) of other banks would be implemented from Monday, December 17.

The Governor of the Central Bank of Nigeria (CBN) and Chairman of the Bankers’ Committee, Sanusi Lamido Sanusi disclosed this while addressing journalists at the end of the fourth annual Bankers’ Committee retreat held in Calabar, Cross River State.

The CBN governor said the delay in implementing the policy was to allow banks configure their information technology infrastructure for the effective implementation of the policy.

“We have agreed on a final date of Monday, 17 December, 2012 for the kick-off when every bank will remove the charges. We allowed some time for banks that have not configured their IT to do so and stop charging and hopefully by 17th of December, you are not going to have any customer pay additional charges,” he said.

Mr Sanusi further said that the CBN was working on a programme that would ensure that from June 1, next year, the Asset Management Corporation of Nigeria (AMCON) commences the process of divesting from the three nationalised banks – Keystone Bank Limited, Enterprise Bank Limited and Mainstreet Bank Limited – which are wholly owned by the corporation.

“We want to start the process by June 1 next year of getting AMCON to divest from the three banks so that by 2014, the process would have been completed,” he said.

Commenting on the privatisation of power assets, the CBN governor said the committee would advise the Federal Government to ensure that the proceeds to be derived from the sale of power assets are invested in infrastructural projects, adding that this would enhance investor confidence in the system.

He said: “With a vision for a better future for Nigerians, the Bankers’ Committee is committed to play a lead role as catalyst for economic development, improving access to finance for the unbanked and under-banked population and growth of the real sector.

“The Bankers’ Committee has focused on the power, agriculture and Transport Infrastructure sectors for driving growth and identified opportunities for financial system intervention in the transformation of these critical sectors of the economy.

“Through collaboration with the government, the banking community and real sector stakeholders, the Bankers’ Committee programmes and initiatives have contributed to a tangible improvement in the enabling environment and private sector funding for the power and agriculture sectors.”

Mr Sanusi added that banking sector lending to the agriculture sector had increased significantly from 1.5 per cent of total industry portfolio to 3.5 per cent in 2012.

He also said that the banking industry has set a target of 7 per cent for agriculture sector lending by 2013 and 10 per cent by 2017.

Mainstreet Bank’s ‘dismissal’ of workers is inequitable

Ikechukwu Ikeji, a lawyer has described as ‘inequitable in law and moral’, the dismissal of over 800 workers by Mainstreet Bank PLC after taking over the assest of Afribank .

He also argued that the use of the word ‘termination’ in the dismissal of the workers without prior warning is illegal.

Following their termination, former staff of Mainstreet Bank on Monday morning gathered at Channels Television to protest against the management of the bank for their unpaid salaries and other entitlements.

The protesters lamented their unpaid gratifications and alleged unfair treatment on them by the bank’s management following the mass sack of about 800 workers in June.

Video: Former Mainstreet bank staff protest ‘unpaid salaries’

Following their termination, former staff of Mainstreet Bank on Monday morning gathered at Channels Television to protest against the management of the bank for their unpaid salaries and other entitlements.

The protesters lamented their unpaid gratifications and alleged unfair treatment on them by the bank’s management following the mass sack of about 800 workers in June.

Mainstreet bank, formerly Afribank, is one the five banks whose management was sacked by  the Central Bank of Nigeria, in 2009, over fraud and mismanagement.


According to the leader of the protesters, Mr Mike Akintola, the workers who had put in over three decades of service to the bank are only paid a month salary instead of their severance package.

“Some of us have been working with them for 31 years now, yet, all they are giving us is a month’s salary……how do they expect us to send our children to school?” he asked.

Another sacked victim of the bank, who claimed to have put in 31 years in with the bank, Mr Eyo Osanran, described the bank’s move as ‘man inhumanity to man’, saying no reason was given for the dismissal letter given to them.

“They must give us our rights and all that they owe us” he added affirmatively.

The sacked workers who have spent over 20-30 years with the bank, alleged that every effort to reach the management of the bank have been futile. They also claimed that the bank has refused to respond to all their moves and letters.

They alleged that the president of the Association of Senior Staff of Banks, Insurance and Financial Institutions (ASSBIFI), Mr. Sunday Salako, who should fight their course as the union leader has being compromised.

According to the protesters, Mr Salako is now the Public Relations Officer of Mainstreet Bank.

However, the ASSBIFI President,  in a live interview with the SUNRISE DAILY, gave the assurance that the case would be looked into.

The protesters demand the payment of severance package and live allowance. They also demand that the word ‘termination’ in the disengaging letter should be changed to service not needed any more.

The management of Mainstreet Bank Plc, formerly Afribank Plc,  sacked about 800 workers in June despite the Federal Government’s and organised labour directive to the management of the bank to maintain status quo pending resolution of labour issues between the management and labour.

 

 

AMCON may list nationalised banks

The Asset Management Company of Nigeria (AMCON) on Tuesday said it may list three banks that were nationalised as part of a bailout in 2009, instead of selling them to rivals, as it seeks to determine fair value for the banks.

The Chief Executive Officer of the Asset Management Company of Nigeria (AMCON), Mustapha Chike-Obi

Mustapha Chike-Obi, the chief executive of AMCON, said the AMCON will need to find financial advisers before finalising its decision on whether to list directly or sell to competitors.

“AMCON is appointing an adviser that will evaluate and determine the value of the banks, evaluate all the options available to AMCON,” he said.

“We expect our eventual adviser to consider this (listing) among other options,” Chike-Obi said. He said in April that all three rescued banks were now profitable.

Previously, AMCON said that more than 20 firms — banks and private equity investors — had expressed interest in acquiring the nationalised lenders, but AMCON is keen to have them valued before starting any negotiations.

It may opt to take them public if it can get a better deal.

The Central Bank of Nigeria (CBN) nationalised three banks changed their names to Mainstreet Bank from Afribank; Enterprise Bank from Spring Bank; Keystone Bank from Bank PHB, for failing to find new investors before a recapitalisation deadline.

The CBN then injected N620 billion into nine banks in 2009, judging that they were dangerously undercapitalised.

Former Afribank director asks court to quash money laundry charges against him

An ex-director with the former Afribank Nigeria Plc (now Mainstreet bank), Chinedu Onyia on Wednesday asked a Federal High Court in Lagos to quash criminal charges preferred against him by the Economic and Financial Crimes Commission (EFCC).

Mr Onyia, in a motion against the charge, insisted that there is nothing on the face of the charge upon which he could stand trial, adding that the EFCC failed to provide credible material to link him with the commission of the alleged crime.

The former bank director is standing trial alongside former Managing Director of Afribank, Sebastian Adigwe, a stockbroker, Peter Ololo and his company, Falcon Securities Limited, former Chairman of Afribank, Osa Osunde and two other directors of the bank – Henry Arogundade and Isa Zailani.

The accused persons are standing trial over alleged abuse of office, banking malpractices and laundering of N55 billion.

According to the charges, Mr Adigwe was said to have conspired with the bank directors to grant several loan without adequate security.

Some of the companies that allegedly benefited from the “reckless” loan included Larix Company Limited, Suletical Nigeria Limited, Broworks Nigeria Limited, Alsmiths Nigeria Limited, Rehoboth Assets Limited and Falcon Securities Limited.

The accused were said to have failed to take all reasonable steps to ensure that the books of accounts of Afribank as at May 31, 2009, gave a true and fair view of the state of affairs of the bank as required by Sections 24 (1), 24 (2) of the Banks and Other Financial Institutions Act. Cap. B3, Laws of the Federation by understating the loan portfolio of the bank.

Specifically, Mr Adigwe had allegedly perpetrated shares fraud by creating a misleading appearance of active trading in the shares of Afribank on the Nigeria Stock Exchange.

He was accused of doing that by approving N2 billion credit facilities to Alsmiths Nigeria Limited to purchase large volume of Afribank’s shares, an offence contrary to Section 105 (1) (a) of the Investment and Securities Act, 2007 and punishable under Section 115 (a) of the same Act.

When the matter came up on Wednesday before Justice John Tsoho, Mr Onyia’s lawyer, Kola Obafemi urged the court to quash the charge against his client, and also discountenance the additional proof of evidence filed by the EFCC.

Mr Obafemi said that the EFCC in the charge alleged that Mr Onyia granted reckless credit facilities, but that the proof of evidence attached by the commission to the charge showed clearly that all facilities were duly authorized.

On the additional proof of evidence, Mr Obafemi argued that it was unfair on the part of the EFCC to file additional evidence against his client after he had pleaded to the charge, and urged the court to take a strong stand on it; otherwise, there would be no end to the filing of papers.

Reacting to the submission by the counsel to the former bank director, the EFCC’s lawyer, K.U.K Ekwueme urged the court to dismiss the two applications filed by Mr Onyia, adding that the man had in his statement to the anti-graft agency, admitted signing on to the approval of credit facilities in the case.

Reps orders Mainstream bank to reinstate sacked workers

The house of representatives has directed the management of Mainstreet bank, to reinstate 41 union members that were sacked by the bank.

The Chairman of the House Committee on legislative compliance, Moruf Akinderu-Fatai gave this directive when the management of the bank appeared before it in Abuja.

The Regional Manager of the bank in charge of Abuja, Dauda Momoh, had informed the committee that the bank cannot absorb the staff.
According to him, Afribank that was the original employer of the sacked workers has been liquidated and Mainstreet bank has no legal obligation to reemploy them.

He said the new management of the Mainstreet bank was appointed by the Central Bank of Nigeria (CBN) and the Nigeria Deposit Insurance Company (NDIC) and that the sacked union members were not part of the liabilities the bank acquired.

The lawmakers in the committee rejected Mr Momoh’s explanation and gave the order that the bank reinstate the sacked workers.