Nigeria Takes Over Orient Bank Uganda

Wednesday, 10th August, 2011

The Central Bank of Nigeria (CBN) on Friday nationalised Afribank Plc, Spring Bank Plc and Bank PHB Plc because the three rescued banks “have not shown the necessary capacity and ability to beat the September 30 recapitalisation deadline.”

The Bank PHB Plc is the majority shareholder in Orient Bank Uganda. Maxwell Ibeanus, the Orient Bank managing director and chief executive officer, yesterday confirmed the takeover. He, however, insisted that the institution operates under the strict supervision of the Bank of Uganda and in accordance with the local laws and regulations.

“The changes in Nigeria are important to ensure recapitalisation. The transition will be seamless,” Ibeanus said in a statement.

“We will continue to deliver a smooth, consistent and professional service to all our customers.”

The Nigerian Deposit Insurance Corporation (NDIC), the regulator, has created three bridge banks (temporary banks) to acquire the assets of the banks so as to continue operations on a fresh note.

Umaru Ibrahim, the NDIC boss, said the provision of the bridge bank option would prevent the liquidation of the banks to avoid hurting depositors.

“This option will provide for continuity in banking service to protect depositors. It will ensures that no depositor losses money,” Ibrahim argued.

The CBN and NDIC had in 2009 carried out a special examination of all banks in Nigeria.

By Stephen Ilungole : The New Vision Newspaper