The Central Bank of Nigeria (CBN) says it has completed the sales of Polaris Bank to Strategic Capital Investment Limited (SCIL), a new core investor.
Osita Nwanisobi, director of corporate communications, said this in a statement on Thursday.
Nwanisobi said the investment company acquired 100 percent equity stakes in the bank.
The statement added that SCIL paid N50 billion zs upfront to acquire the equity.
Polaris has been operating as a bridge bank since 2018 when CBN intervened to revoke the licence of the former Skye Bank Plc and established a bridge bank to assume its assets and certain liabilities.
“This sale marks the completion of a landmark intervention in a strategic institution in the Nigerian banking sector by the CBN and AMCON. 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, the statement quoted Godwin Emefiele, CBN governor, as saying.
“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.”
WHAT IS IN THE DEAL?
According to the statement, SCIL has paid an upfront consideration of N50 billion to acquire 100 percent of the equity of Polaris Bank and has accepted the terms of the agreement. The statement said the terms include the full repayment of the sum of N1.305 trillion, being the consideration bonds injected.
It said the CBN has 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.
HOW IT WENT DOWN
The apex bank spokesperson said the sale was “coordinated by a Divestment Committee (the ‘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.,” the statement adds.
“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.”