Shareholders of collapsed Skye Bank are still perplexed over the sudden decision of the Central Bank of Nigeria to revoke the bank’s license, handing its assets to a bridge bank, Polaris.
National Daily gathered from sources that the CBN may have already found a potential buyer for the bank and that the creation of the bridge bank, Polaris Bank is to pave way for further negotiations.
While the CBN may have been justified in its actions, at no point did the bank give shareholders a deadline to recapitalise the bank.
Precedence from a prior case under then CBN Governor Lamido Sanusi, shareholders were given a deadline to recapitalise the banks. After they failed to do so, their licences were revoked.
Indeed, Skye Bank shares had been trading on the floor of the Nigerian Stock Exchange and were one of the better performers this year, having gained over 40% year to date. Skye Bank shares are in fact, is beating the Nigerian Stock Exchange.
Some analysts also point to the fact the Skye Bank’s debacle may have also been worsened by AMCON, whom the CBN is inadvertently handing it over to.
In 2014, AMCON announced that Skye Bank has won the bid to acquire another CBN creation, Mainstreet Bank. The acquisition was consummated in 2016 at a price of just over N120 billion.
According to analysts, this was perhaps the catalysts to Skye Bank’s downfall. With the billions in director related loans which had gone bad, the Mainstreet Bank acquisition worsened its balance sheet setting the stage for its financial quagmire.
Skye Bank last released its results for the financial year ended December 2015. In its most recent notice, to the Nigerian Stock Exchange (NSE), the bank had stated that it had submitted its results for the year ended 2016 and 2017, and half year ended June 2018 to the CBN and was awaiting approval.
An absence of audited results means investors do not have an exact idea of how much the CBN injected into the bank as liquidity. The apex bank had disclosed in that it had injected a N100 billion into the bank.
The Nigeria Stock Exchange (NSE) may also be complicit in the losses faced by shareholders. The exchange should have at the very least placed the stock on a partial technical suspension to prevent speculation by investors, having suspended other firms earlier this year for non-submission of results as at when due.
Skye Bank opened the year at N0.52 per share and hit a year high of N1.61, before dropping to N0.77, when a suspension was slammed.
The stock has outperformed the All Share Index and was up 48% as at Friday’s trading.
The stock also witnessed large volume of trades in its last trading week, indicating parties with access to privileged information could have either bought in or exited.
Leave a comment
About Article Author