The Central Bank of Nigeria (CBN) has announced M. k Ahmad and Tokunbo
Abiru the new Chairman and Chief Executive Officer of Skye bank
respectively. Both of them are now to bear the burden of turning around
the bank’s huge liquidity challenge and quickly save it from collapse.
CBN’s
announcement came shortly after the bank’s former Chairman, Olatunde
Ayeni; Managing Director, Timothy Oguntayo; the Deputy Managing
Director, Non Executive Directors; Independent Directors; and the two
longest serving Executive Directors all voluntarily resigned just ahead
of a central bank pronouncement that it had dissolved the board and
removed part of the management over capital adequacy issues.
The CBN, however retained the most recently appointed Executive Directors of the bank.
Ahmad is the former director general of PENCOM and Tokunbo Abiru is the former Lagos State commissioner for finance
CBN
governor Godwin Emefiele, who announced the new appointment and
confirmed Oguntayo’s resignation said that Skye Bank’s carries quite
some huge bad assets that saw the Non-Performing Loans exceeding the
allowed 5 percent threshold.
Emefiele said specifically that the
new appointment was as a result of the lenders failure to meet minimum
threshold in critical prudentials and adequacy ratios.
“In
particular, Skye bank liquidity and non performing ratios have been
below and above threshold respectively”, Godwin Emefiele said in Lagos
at a press conference.
Earlier reports said Skye Bank was
thought to have an estimated non performing loan portfolio of N700
billion, much of which is due to an overexposure in the oil and gas
sector.
More of the banks were feared to be equally facing tight
liquidity challenges but Emefiele, at the press Monday afternoon doused
the fears, saying the apex bank was yet to find any more banks such
dire situation.
The Nigeria Deposit Insurance Corporation (NDIC)
disclosed recently that Deposit Money Banks’ NPLs reached 4.87 percent
in 2015, a situation currently raising concerns around quality of assets
in the industry, eventhough though still within the regulatory
threshold of 5 percent.
In its 2015 Annual Report, NDIC had said
the industry’s loans and advances to the Nigerian economy stood at
₦13.33 trillion in 2015, indicating some 5.56 percent increase over the
₦12.63 trillion reported in 2014.
“The non-performing loans to
total loans ratio for the industry increased from 2.81% in 2014 to 4.87%
in 2015, but was within the regulatory threshold of 5%,” the
Corporation noted in a mailed summary report.
Governor Emefiele,
told journalists that the CBN had been discussing with the Oguntayo’s
led management on the need to quickly reverse the huge bad assets which
they were practically unable to do till he exited as the bank’s CEO.
Oguntayo, led Skye Bank to acquire nationalised lender Mainstreet Bank
in 2014,
Emefiele said the CBN hopes the new management would be
able to salvage the bank from collapse, explaining the reasons for the
swift change.
Skye Bank, a Nigerian based commercial bank and one
of the twenty-six (26) commercial banks licensed by the CBN is a large
financial services provider in West Africa and Central Africa. With
headquarters in Nigeria, the bank maintains subsidiaries in Sierra
Leone, the Gambia, the Republic of Guinea, Liberia, Angola and
Equatorial Guinea.
As at December 2014, the bank had grown its loan portfolio by 18.4% and saw its assets hit N1.42 trn
The
bank’s loans and advances grew from N549.9 billion in 2013 to N651.3
billion in 2014. Specifically, Skye Bank recorded total assets of N1.42
trillion, representing a 26.8 per cent growth over the N1.12 trillion
recorded during the corresponding period in 2013