Daily Trust (Abuja)
5 November 2009
Abuja — The Central Bank of Nigeria (CBN) yesterday granted the request of shareholders of the Equitorial Trust Bank Plc to inject additional capital into the bank by June 30 next year.
When CBN released the last audited report of the Special Examination of 14 banks last month, it directed the bank to recapitalise on or before June 30, 2010.
In pursuance to that, the shareholders executed a Deed of Covenant to recapitalise and rectify problems identified with the bank by the CBN.
A statement from Muhammed Abdullahi Head Corporate Affairs of CBN said the apex bank will closely monitor the implementation of the terms of the Covenant to ensure that the lapses are fully rectified and in the overall interest of the banking system.
The statement read: "Having reviewed the terms and conditions of the Deeds of Covenant, the CBN has consented to the request aimed at further strengthening the bank. In granting these requests, CBN noted that the Special Examination had not raised issues of serious supervisory concern or criminal activity by any member of the Board of ETB."
Shareholders of the ETB said are ready to restructure, diversify and enlarge the capital base of the bank either by way of a public offering of shares, securing a core investor or merger with a local bank within one (1) year period.
They will also address the corporate governance issues in the bank which were mainly ascribed to the previous Executive Management team in the bank and reconstitute the Board of Directors of the bank through the retirement of two non-executive directors and the appointment of four new non-executive directors, including Dr. Mike Adenuga Jnr. (CON), an erstwhile member of the board, subject to the approval of the Central Bank of Nigeria.
They will also convene a general meeting of the bank's shareholders to ratify, through a resolution all the nominated appointments to the bank's board.
Also yesterday, CBN debunked stories that it was against the Federal Government's policy of deregulation of the downstream sector of the petroleum industry.
CBN's spokesman Abdullahi said at no time did Governor Sanusi Lamido Sanusi "express the Bank's opposition to the planned deregulation of the oil industry as portrayed by a section of the media."
He said that what the Governor said during the Monetary Policy Committee briefing was that "while inflation had de-accelerated, it is important to recognize that seasonal factors and the planned deregulation of prices of petroleum products (through cost of transportation ) pose a major risk to inflation outlook in the near to medium term."
"The CBN therefore wishes to state categorically that it is in full support of the Federal Government's policy on deregulation, in view of the inherent benefits and advantages to the economy and that the stories in a cross section of the media were completely out of context", Abdullahi said.
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