The sale of Polaris Bank to Strategic Capital Investment Limited (SCIL) was completed, according to a statement from the Central Bank of Nigeria (CBN).
This information was released in a statement on Thursday by Osita Nwanisobi, the director of corporate communications of CBN, according to Anaedoonline.ng.
Nwanisobi revealed that the CBN and Asset Management Company of Nigeria signed the agreement with SCIL (AMCON).
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The CBN Director claims that SCIL paid N50 billion to purchase 100% of Polaris Bank’s stock and has agreed to all of the provisions of the deal, which include paying back the full amount of N1.305 trillion, which represents the consideration bonds invested.
Nigeria intervened to revoke the licence of the former Skye Bank Plc and established Polaris Bank to assume its assets and certain liabilities. 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. These actions were taken to prevent the imminent collapse of the bank, enable its stabilisation and recovery, protect depositors’ fund, prevent job losses and preserve systemic financial stability.”
“SCIL 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 stabilisation period, as well as ensuring that all funds originally provided to support the intervention are recovered.
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“The sale was coordinated by a Divestment Committee comprising representatives of the CBN and AMCON, and advised by legal and financial consultants. 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. In the process, parties who had formally expressed an interest in acquiring Polaris Bank, subsequent to the CBN intervention in 2018, were invited to submit financial and technical proposals. Invitations to submit proposals were sent to 25 pre-qualified interested parties, out of which three (3) parties eventually submitted final purchase proposals following technical evaluation. All submissions were subject to a rigorous transaction process from which SCIL emerged as the preferred bidder having presented the most comprehensive technical/financial purchase proposal as well as the highest rated growth plans for Polaris Bank.”
Speaking about the deal, CBN Governor Godwin Emefiele said the sale completes a historic involvement by the CBN and AMCON in a key institution in the Nigerian banking system.
He said: “We commend the outgoing board and management for their vital role since the bridge bank was established; in stabilising the Bank’s operations, its balance sheet and implementing strong governance structures to address the issues that led to the intervention.
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“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.”
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