SKYE BANK CRISIS: PANIC WITHRAWALS AS CBN EXPLAINS WHY IT STRUCK

Information reaching  us indicates that people are rushing to ATM machines to withdraw their cash from Skye Bank, following reports that suggested the bank is distressed. But no need to panic.
The Central Bank of Nigeria (CBN) has announced M. k Ahmad and Tokunbo Abiru as new Chairman and Chief Executive Officer, CEO, of Skye bank, respectively. Both men are now to bear the burden of turning around the bank’s huge liquidity challenge and quickly save it from collapse.


CBN’s announcement came shortly after the bank’s former Chairman, Olatunde Ayeni; Managing Director, Timothy Oguntayo; the Deputy Managing Director, Non Executive Directors; Independent Directors; and the two longest serving Executive Directors all voluntarily resigned just ahead of a central bank pronouncement that it had dissolved the board and removed part of the management over capital adequacy issues.

The CBN, however retained the most recently appointed Executive Directors of the bank.

Ahmad is ex-Director Feneral of PENCOM and Tokunbo Abiru is former Lagos commissioner for finance.

CBN governor Godwin Emefiele, announced the appointment and confirmed Oguntayo’s resignation. He said that Skye Bank’s carries quite some huge bad assets that saw the Non-Performing Loans exceeding the allowed 5 percent threshold.

Emefiele said specifically that the appointment was as a result of the lenders failure to meet minimum and acceptable threshold in critical prudentials and adequacy ratios, Business day reports.

“In particular, Skye bank liquidity and non performing ratios have been below and above threshold respectively”, Godwin Emefiele said at a press conference in Lagos.

Earlier reports said Skye Bank was thought to have an estimated non performing loan portfolio of N700 billion, much of which is due to an overexposure in the oil and gas sector.

More banks were feared to be equally facing tight liquidity challenges but Emefiele, on Monday afternoon doused the fears, saying the apex bank was yet to find any more banks in such dire situation.

The Nigeria Deposit Insurance Corporation (NDIC) disclosed recently that Deposit Money Banks’ NPLs reached 4.87 percent in 2015, a situation currently raising concerns around quality of assets in the industry, even though still within the regulatory threshold of 5 percent.

Skye Bank, a commercial bank and one of the twenty-six (26) commercial banks licensed by the CBN is a large financial services provider in West Africa and Central Africa, with headquarters in Nigeria.

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