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FirstRand eyes Nigerian bank

Jan 12 2010 07:08

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Lagos - FirstRand has expressed interest in buying one of the nine Nigerian banks rescued by the West African country's central bank last year, the company's new managing director told Reuters on Monday.

Nigeria's central bank asked for potential bidders to register their interest in the troubled banks by mid-December to test the appetite for acquisitions as the regulator looks to reshape Nigeria's banking landscape.

The regulator has not published the names of any interested parties.

"We did register interest in that process. I'm not able to mention (which bank), but we certainly registered our interest," FirstRand's Managing Director Sizwe Nxasana said on the sidelines of an economic conference.

FirstRand, South Africa's second largest banking group, is the first foreign bank to confirm it is interested in buying one of the troubled banks. Nigeria's Fidelity Bank said in November it was also a potential bidder.

Nxasana, who took over the reins of FirstRand in December, said FirstRand is looking to invest "meaningful amounts of capital" and fund any deal from its internal reserves.

"We are looking at opportunities, especially given the reforms taking place driven by the Central Bank of Nigeria," he said.

Nigeria's central bank has injected about 600 billion naira into the banking system since mid-August, after its auditors found nine institutions had built up bad loans that left them too weakly capitalised to sustain their operations.

It injected 400 billion naira into Afribank, Finbank, Intercontinental Bank, Oceanic Bank and Union Bank on August 14 and sacked their top management after the first round of the audit.

Two months later it said it was providing 200 billion naira to four more banks - Bank PHB, Equitorial Trust Bank, Spring Bank and Wema Bank - also judged to be facing a grave liquidity crisis.

The regulator has said the businesses will be run as going concerns until new investors can be found to recapitalise them and that its preferred option is for them to be bought out.

- Reuters

 
 
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