Indications emerged at the weekend that a group of Chinesse investors are serious discussions to acquire Polaris Bank Limited, a bridge bank formed in the wake of the take-over of defunct Skye Bank in 2016 by the Central Bank of Nigeria (CBN).
Although information about theplanned Chinese acquisition is still sketchy, it was learnt that serious talks began some months ago, culminating in the decision of the Chinese investors to buy the bank.
According to sources familiar with the transaction, the crucial stages of due diligence and other valuations had been scaled, paving the way fora possible acquisition and take-over of the bank’s operations by the Chinese investors. It is expected that the bank may go through another round of name change once the transaction goes ahead and gets clearance from all the parties required to give an all clear to it.
By the time the deal becomes a fait accompli, it will be the first time that the Chinese will be seriously having a foothold in the nation’s banking industry in a controlling role, and may also well be the beginning of a strong foothold in a critical sector of the economy by far-east Asians.
Business a.m. tried to get multiple sources to go on the record with what they know but they said they would rather wait and see. Sources at Polaris and Asset Management Corporation of Nigeria (AMCON) would rather not speak until they had a clearance to speak on the Chinese interest in Polaris Bank.
“It would be out of place to speak on an on-going discussion regarding the sale of a bank. As you know, any information can be very sensitive and could impact either way on the discussions,” said someone familiar with the development.
The Asset Management Corporation of Nigeria had at various times acquired a number of Nigerianbridge banks preparatory to their eventual purchase by new investors as a way of keeping the banks alive and safe guarding the jobs of thousands of workers in those organisations. At some point the bridge banks includedKeystone Bank, Mainstreet Bank, Enterprise Bank and later Polaris Bank.
Polaris Bank, formerly known as Skye Bank Plc, emerged from the business combinations of five legacy banks after the banking industry consolidation of 2004/2005. The legacy banks were Prudent Bank, Eko International Bank Limited, Reliance Bank Limited, Cooperative Bank Limited and Bond Bank Limited.
Polaris Bank currently employsover two thousand workers and has about 300 branches spread across the country, and has a strong retail franchise.
Its current management was appointed by the CBN in 2016 following the dissolution of both the board and management teams over alleged infraction of code of governance. Last year, the CBN withdrew the license of Skye Bank and a new entity came into being.
The apex bank had then said it decided to establish a bridge bank, ‘Polarise Bank,’ to secure the assets and liabilities of Skye Bank.
Emefiele said: “As a responsible and responsive regulator and in consultation with the Nigerian Deposit Insurance Corporation (NDIC), we have decided to establish a bridge bank, ‘Polaris Bank,’ to assume the assets and liabilities of Skye Bank.
“The results of our examinations and forensic audit of the bank have revealed that Skye Bank requires urgent recapitalisation as it can no longer continue to live on borrowed times with indefinite liquidity support from the CBN. The shareholders of the bank have been unable to recapitalise it,” Emefiele said during the media briefing.
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