The CBN Governor Godwin Emefiele, said in consultation with the Nigerian Deposit Insurance Corporation (NDIC), the CBN decided to establish a bridge bank, Polaris Bank, to assume the assets and liabilities of Skye bank.
Mr Emefiele added that the strategy is for the Asset Management Company of Nigeria (AMCON) to capitalize the bridge bank and begin the process of sourcing investors to buy out AMCON.
“By this decision, the licence of the defunct Skye Bank is hereby revoked,” he said, adding that “all customers of Skye Bank shall be automatic customers of the new bank and their accounts and records duly purchased by Polaris Bank.”
The CBN governor explained however that given the good performance of the board and management of the bank, the CBN shall retain them. In addition, he said, all employees of Skye Bank shall be absorbed by Polaris Bank under a new contract except any employee decides to opt out.
Skye Bank had in 2016 been under the radar of the CBN after the apex bank discovered some “unacceptable corporate governance lapses as well as the persistent failure of Skye Bank PLC to meet minimum thresholds in critical prudential and adequacy ratios, which culminated in the bank’s permanent presence at the CBN Lending Window.”
The focus of the action then was to save depositors’ funds and to ensure that the bank continued as a going concern, being a systemically important bank, Mr Emefiele said Friday.
He added that although the bank’s performance improved afterwards, the bank needs urgent recapitalization.
“The result of our examinations and forensic audit of the bank revealed that the Skye Bank requires urgent recapitalisation as it can no longer continue to live on borrowed times with indefinite liquidity support from the CBN,” he said.
“We wish to assure all depositors that under this arrangement, their deposits shall remain safe and that normal banking services shall continue in the new bank on Monday, 24th September 2018, to ensure customers to transact their businesses seamlessly.”