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Five rescued banks to call EGMs by Sept 30 – AMCON

By on August 16, 2011

Nigeria’s state asset management company (AMCON) said it expects five of the nine banks that were bailed out for $4 billion to call extraordinary general meetings by Sept. 30, so shareholders can vote on recapitalisation deals signed with investors.

AMCON Chief Executive, Mustapha Chike-Obi, told Reuters on Tuesday he expected shareholders to accept the deals. If they did not, regulators would need to explore all options to protect depositors, employees and the financial markets.

Three of the other banks rescued in 2009 were nationalised this month after they failed to show an ability to recapitalise. The other rescued lender, Unity Bank , has already recapitalised.

Intercontinental Bank , Oceanic Bank , Finbank , Union Bank and Equitorial Trust Bank have signed agreements with investors, but shareholders have yet to accept the deals.

“If they go to EGMs and decide to reject the deal, then it will be clear those banks will not be able to recapitalise themselves and regulators will need to step in. But I don’t expect them to do that,” Chike-Obi told Reuters.

“If it is clear a bank cannot recapitalise on its own, then all options will have to be explored by regulators. We will not allow depositors, employees or the financial system to suffer.”

AMCON took over Spring Bank, Afribank and Bank PHB — all part of the 2009 bailout — after they were nationalised because they did not show an ability to recapitalise, a move the central bank said would draw a line under the country’s banking crisis