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Tag: AMCON

  • AMCON urges court to restrain Bi-Courtney from executing judge’s ruling

    The Asset Management Corporation of Nigeria (AMCON) has prayed the Federal High Court in Lagos for an order restraining Bi-Courtney Limited and its Chairman, Dr. Wale Babalakin (SAN) from executing the September 29 ruling by Justice Ibrahim Buba.

    In an Application with Notice for Injunction Pending Appeal, AMCON is seeking an order restraining the respondents, their agents or subsidiaries “from giving effect to the order.”

    Justice Buba, in his ruling, made an order nullifying and discharging the ex-parte order of receivership, possession and freezing granted it by Justice Okon Abang on September 22.

    Justice Abang had appointed a former Nigerian Bar Association (NBA) president, Dr. Olisa Agbakoba (SAN), as AMCON’s receiver/manager over the assets of Bi-Courtney, Chartered Investment Limited, Resort International Limited, Roygate Properties Limited and their chairman Babalakin for allegedly owing AMCON N50billion.

    AMCON is urging the court to grant the injunction restraining the companies from “dissipating their assets.”

    It said if they are not restrained, they could manage the assets in a way that could adversely affect its case at the appellate court.

    The applicant’s grounds are that after Justice Abang made the order, Justice Buba, based on oral application by the respondents’ counsel, vacated it.

    AMCON said because it was dissatisfied with Justice Buba’s ruling, it filed an appeal at the Court of Appeal, seeking to set it aside.

    “The present application is necessary to restrain the respondents from dissipating their assets and rendering nugatory the possible outcome of the appeal at the Court of Appeal.

  • Bi-Courtney: AMCON appeals sack of Agbakoba

    Bi-Courtney: AMCON appeals sack of Agbakoba

    The Asset Management Corporation of Nigeria (AMCON) has appealed the ruling nullifying the appointment of a former Nigerian Bar Association (NBA) President, Dr Olisa Agbakoba (SAN), as the receiver/manager for the assets of Bi-Courtney Limited, its Chairman Dr Wale Babalakin (SAN) and three other companies.

    Justice Ibrahim Buba of the Federal High Court Lagos, in a bench ruling on Monday, held that an earlier order by Justice Okon Abang, appointing Agbakoba as Bi-Courtney’s  manager/receiver, was made in error.

    He said the order should not have been made because there were pending cases and subsisting orders on the same case before him.

    According to him, the true facts were not given to Justice Abang.

    “This court has no been misled,” Justice Buba held, adding that Justice Abang’s order was “a nullity”.

    Dissatisfied with the ruling, AMCON, through Agbakoba, filed a notice of appeal at the Court of Appeal in Lagos on four grounds.

    The appellants said Justice Buba erred in law and misdirected himself when he heard and granted the oral application by Bi-Courtney’s lawyers to vacate the receivership, possession and freezing orders by Justice Abang on September 22.

    The agency averred that Part XIV of AMCON Practice Directions 2013 was clear that major applications should be filed and served on each party before hearing.

    On the second ground, AMCON said Justice Buba misapplied the law when he held that Justice Abang’s order amounted to abuse of court process.

    It said the cause of action in the suit before Justice Buba was different from what Justice Abang based his order on.

    Besides, the appellant said there was a full disclosure of the relevant materials and facts at the time Justice Abang made the order.

    It urged the Appeal Court to overrule Justice Buba, adding that the judge was wrong for ruling that Justice Abang was misled.

    On the third ground, AMCON averred that Justice Buba was also wrong when he held that the discharge of Justice Abang’s order had concluded the suit.

    It said Sections 49 and 50 of AMCON Act allows it 14 days, from the date an order is granted, to file a debt recovery action.

    On the fourth ground, the appellant submitted that Justice Buba also erred by setting aside Justice Abang’s orders when the oral application by Bi-Courtney’s lawyers were only for the suspension of the execution of Justice Abang’s order.

    AMCON averred that Justice Buba’s ruling, which set aside Justice Abang’s order, was made without jurisdiction, whereas a court cannot grant prayers not sought by any of the parties before it.

    AMCON is praying the Court of Appeal to nullify Justice Buba’s ruling and uphold Justice Abang’s orders.

    In a statement on the matter, Agbakoba said a motion to stay the execution of Justice Buba’s ruling would be filed soon.

    The lawyer was also appointed the receiver of the assets of Chartered Investment Limited, Resort International Limited and Roygate Properties Limited on behalf of AMCON.

    The Murtala Muhammad Airport 2 (MMA 2) is owned by Bi-Courtney, pursuant to a concession agreement with the Federal Government.

    Roygate Properties acquired the old Federal Secretariat building in Ikoyi, Lagos, following another concession agreement between it and the Federal Government.

    AMCON, through Agbakoba, applied to the court for orders of possession and receivership on the assets, following the alleged failure of the companies to pay a cumulative debt of about N50 billion they owed AMCON, which Justice Abang granted.

    Babalakin is the chairman of the companies.

    In his ruling, Justice Buba held as follows: “This court has no doubt that its process has been abused. It has been misled on the issue of settlement breaking down and obtaining orders ex-parte while cases are pending in court, with orders subsisting.

    “Where a court of law feels its orders are irregularly obtained, or its process abused, it shall deal with the process instantaneously, without any formality, to protect its integrity.

    “The order is a nullity, having been obtained ex-parte in the face of subsisting orders already made by this court and which constitute an abuse of the court process. This court will not suspend it (the order).

    “The court has inherent jurisdiction to deal with an abuse of its process and any conduct that impugns its integrity.

    “I so deem and set aside the orders of September 22, 2014, made by my brother Abang J. The court was misled. It is within the issues that this court can deal with.”

  • Enterprise: Will Heritage beat October 13 deadline?

    Enterprise: Will Heritage beat October 13 deadline?

    The sale of Enterprise Bank Limited entered the final stage when the Asset Management Corporation of Nigeria (AMCON) announced Heritage Bank Limited and Fidelity Bank Plc as preferred and reserved bidders respectively. Although Heritage Bank has paid the initial 20 per cent part payment and still has up till October 13 to make the final payment or Fidelity Bank steps in. COLLINS NWEZE reports on the unfolding opportunities and intrigues that greet the sale.

    The race for Enterprise Bank sale has been on for over a year. On Thursday, September 11, the Asset Management Corporation of Nigeria (AMCON) announced HBCL Investment Services Limited (HISL), sponsored by Heritage Banking Company Limited, as the preferred bidder for Enterprise Bank.

    The firm has up till October 13 to balance about N44.8 billion, representing 80 per cent of the N56 billion bid price.

    While the clock ticks for Heritage to pay up, Fidelity Bank Plc, the reserved bidder is patiently waiting to step in, should the payment arrangement fail.

    But Heritage Bank CEO, Ifie Sekibo assured stakeholders that the lender will beat the deadline. He is already planning the post-Enterprise Bank era, outlining strategies that would transform the new entity to a mega bank.

    He confirmed that the lender has already paid the 20 per cent or N11.2 billion of the N56 billion bid prices before the Share Purchase Agreement (SPA) was signed in Abuja about fortnight ago.

    The Heritage Bank boss confirmed that the bank had already paid the initial 20 per cent of the total bid price for Enterprise Bank pointing out that efforts were already in place to ensure the payment of the final 80 per cent within the time frame stipulated by AMCON.

    He said the lender is already working on the process it believes, will finally culminate in the acquisition of Enterprise Bank Limited to further drive its time-proven potentials of creating, preserving and transferring wealth among its teeming customers.

    “In line with AMCON’s requirements for the acquisition of Enterprise Bank Limited, HBCL Investment Services Limited (HISL) which is the special purpose vehicle sponsored by Heritage Bank Limited to bid for Enterprise Bank on Friday last week signed the Share Purchase Agreement (SPA).

    I am also aware that HISL has paid the initial 20 per cent as specified in the terms of the agreement. Efforts are ongoing to ensure that the balance 80 per cent is also paid in line with the terms, conditions and time frame specified by AMCON. This major step towards the acquisition of Enterprise Bank by HISL and by extension, Heritage Bank, fills us with great excitement. With this take over process going on smoothly, we are sure a more energized bank with improved capacity to create, preserve and transfer wealth will soon emerge,” he assured.

    Managing Director, CRC Credit Bureau, Tunde Popoola said the acquisition, when completed, would improve competition in the banking sector.

    He explained that in acquisition of this nature, there are different things that are involved including the winner’s ability to pay. He expressed optimism that Heritage will be able to muster the required fund and pay before the deadline expires.

    “Don’t forget that they bided on their own. They provided the value of the bid. Where you are bidding and you are providing amount you want to pay, it then means you have a way of sourcing for that fund. Otherwise, it does not make sense to bid for an amount you will not be able to pay,” he said.

    Popoola said the process has been transparent and winners know the timeline they will be given to pay. He however said the bank must pay without depleting its capital adequacy. “And as a banking institution, they must have the required money without impairing their capital adequacy. If they do not have the means to pay, and the time expires, there is already a reserved bidder,” he said.

    He said should Heritage fail to pay, the right to acquire Enterprise Bank will then go automatically to Fidelity Bank. “If they fail to pay, that goes back to the second bidder who will then pay its bid price. Whichever way it goes, I believe Enterprise Bank will be better for it and the economy will also be better for it because you will see a bank that will run fully with all the potentials,” he said.

     

    AMCON factor

    The AMCON and Heritage Bank Limited SPA will enable the latter acquire the entire issued and fully paid up ordinary shares of Enterprise Bank Limited.

    AMCON had in a statement endorsed by its Head, Corporate Communication, Kayode Lambo announced HBCL Investment Services Limited (HISL), sponsored by Heritage Banking Company Limited (Heritage Bank), as preferred bidder while Fidelity Bank Plc was named reserve bidder for the acquisition of the bridged lender.

    The AMCON spokesman said the bid process started with interest shown by 24 parties cutting across local and international boundaries. The emergence of HISL and Fidelity Bank as preferred and reserve bidders respectively, he said, resulted from a rigorous and competitive bidding process, which was coordinated for AMCON by Citigroup Global Markets Limited, Vetiva Capital Management Limited (Financial Advisers) and G. Elias & Co. (Legal Advisers).

     

    The controversy

    The AMCON has consistently defended the transparency of the deal. In July, it refuted newspaper report alleging that it interfered with the bid process to favour a particular local bank.

    In a statement, Lambo said the bid process leading to the sale of Enterprise Bank has not even reached the stage where any result would be sent to the Central Bank of Nigeria (CBN).

    It said this suspicion was aggravated when AMCON suddenly changed one of the rules for the sale of the Bank shortly after the final bids were submitted. This, according to the report, prompted the CBN Governor to order AMCON to conduct fresh final bids, based on some specific criteria that would be used to adjudge the bids submitted by the five contesting institutions.

    The apex bank is alleged to have seen the result of the final bid submitted by AMCON as inconclusive, with attempt to focus on criteria that would influence the outcome in favour of the particular bank.

    But in a reaction, AMCON said it wanted the public to know that after the advisers (Messrs Citibank and Vetiva) who it employed have concluded their work, AMCON’s management and board will consider the result before the approved buyers are officially sent to the CBN.

    “It is therefore premature for the report to say that AMCON interfered with the process, as the process is still on-going and no names have yet been officially sent to the AMCON board for consideration,” the statement said.

    “AMCON has not interfered in any way in the process that is still entirely in the hands of the advisers. When the advisers present their final report, which we expect within the next two weeks, regulatory approval will be required and sought,” the statement said.

     

    Rules of engagement

    AMCON commenced the sale of Enterprise Bank on September 22nd, last year when it formally invited interested buyers to express interests in acquiring its 100 per cent stake in the bank.

    The audited financial statement of the Enterprise Bank Group as at 31 December 2012, show that the Group’s Total Assets stood at N263.5 billion, Customer Deposits at N208.4 billion and Total Equity at N31.9 billion

    The invitation by AMOCN prompted interests from some Nigerian banks namely Diamond Bank Plc, Fidelity Bank Plc, Sterling Bank Plc, Stanbic IBTC Bank Plc, Standard Chartered Bank, Skye Bank, Heritage Bank Limited and other investment groups.

    Others include investors like Taunus Holdings, Sahara Energy, Obat Oil and about 12 private equity firms backed by experienced bankers as well as financial and investment analysts.

    AMCON said interested buyers should indicate their interest by submitting an Expression of Interest (EoI) with information such as the “description of acquiring entity or vehicle with evidence of registration or incorporation; ownership of the acquiring entity or vehicle; identifying all shareholders with a five per cent or more stake; strategic rationale for the acquisition of Enterprise Bank; relevant financial services industry experience and/or demonstrable evidence of ability to manage a bank of this nature.”

    Also, interested buyers were requested to submit evidence of financing capacity, while a consortium should “provide evidence of alliance/partnership/joint venture between members in the consortium, clearly indicating the lead member authorised to submit the EoIs.”

    The corporation had added: “Upon receipt and evaluation of the EoI, a shortlist of buyers, who in AMCON’s view are deemed to be fit and suitable from a regulatory perspective (amongst other things), will be prepared and will proceed to the first phase of the transaction.

    Analysts advised that the potential investor in the bank should have a disciplined board and management that adhere to sound corporate governance principles.

    Former Head of Research and Corporate Development, Consolidated Discounts Limited (CDL), Mr. Jimi Ogbobine, argued that tier two banks will benefit more by buying Enterprise Bank. He said the bank’s branch network remains a major strength that ambitious lenders can tap into.

    He explained that the legacy bad loans of Enterprise Bank have been bought by AMCON, adding that overall, the offer looks attractive.

    The Managing Director/Chief Executive Officer of Enterprise Bank Limited, Ahmed Kuru, said he was happy leaving behind, a better Enterprise Bank and a happier workforce. He added that he was convinced that customers will have the best deal at the conclusion of the process. “I am convinced our customers expect the best deal at the end of the day. So their expectation should be high,” he said.

    He explained that right from the beginning when he was appointed, it was very clear to him that AMCON, at certain point in time will divest from the bank.

     

    Bridged banks

    Enterprise Bank is wholly owned by AMCON. Other bridged banks owned by AMCON are Keystone and Mainstreet banks. The corporation had acquired the lenders in August 2011, after the intervention by the Nigeria Deposit Insurance Corporation (NDIC) and the Central Bank of Nigeria (CBN). Enterprise Bank was created from the ashes of the defunct Spring Bank, while Keystone Bank and Mainstreet Bank were created from the defunct Bank PHB and Afribank respectively.

    As part of efforts to divest its shareholdings in the three banks by 2014, starting with Enterprise Bank, AMCON had appointed Citigroup Global Markets Limited (Citi) and Vetiva Capital Management Limited as Financial Advisers, as well as G. Elias & Company as Legal Adviser to the transaction.

    Enterprise Bank commenced operation in August, 2011, as a full-service commercial bank with a national banking license. The bank operates via a sizeable distribution network of over 160 branches spread across major markets and commercial centres in Nigeria, and with over 177 automated teller machines (ATMs), 57 Cash Centres and 2,000 point of sales (PoS) terminals.

     

  • Fed Govt, AMCON owe us N132b, says Bi-Courtney

    Bi-Courtney Aviation Services Ltd (BASL) said yesterday that the Asset Management Company of Nigeria (AMCON) and the Federal Government owed it over N132billion by virtue of a subsisting 2011 ruling of the Federal High Court.

    Briefing reporters at the Murtala Muhammed Airport Terminal Two, Ikeja, Lagos after the Federal High Court discharged and struck out the order obtained by AMCON through its counsel Mr. Olisa Agbakoba (SAN), to take over the assets of the firm in lieu of the controversial debt, the head of litigation, Babalakin and Company, Mr. Tola Oshobie, said the debt owed the company by the Federal Government was predicated on the breach of agreement between the firm and the government.

    He said the loss of revenue to the firm over the refusal of the government to hand over the old domestic terminal of the Lagos Airport was responsible for the firm’s default in paying the loan it took from a consortium of banks.

    Oshobie said the position of Bi-Courtney in its face-off with AMCON over the controversial debt settlement agreement between the two had for the umpteenth time been upheld by the judiciary.

    Ruling in an oral application by Bi- Courtney to vacate the order, which was allegedly procured by AMCON, Justice M.I. Buba struck out the order on the grounds that it was an abuse of process, and declared that the order was a nullity.

    Bi- Courtney described the ruling as a victory for the rule of law, “even as it has strengthened confidence in the judicial process.”

    The company described the purported takeover of the terminal and the old Federal Secretariat, both in Lagos, by AMCON, as a contrived and reckless action as well as a deliberate assault on the integrity of the judicial system by the self-styled receiver, Mr. Agbakoba.

    The head of litigation also described the management of AMCON and its counsel as serial users of the law, noting that the order purportedly obtained by Agbakoba was fraudulently and unlawfully obtained from the Federal High Court by concealing the existence of two court orders since November 4, 2011.

    He said the suit restrained the Federal Government and AMCON from interfering with the operations and finances of Bi-Courtney and Resort International Ltd as well as their related or associated companies.

    “It is noteworthy that with  AMCON being a party in the above matter and Olisa Agbakoba being its counsel, the purported appointment of same as a receiver was a demonstrable evidence of the cavalier, contemptuous and illegal action.

    “The failed attempt by AMCON to disrupt the operations of MMA 2 is insensitive, with grave implications for the drive to engender a private sector-led resuscitation of public infrastructure and the nation’s economy. It is a deliberate attempt to frustrate investments, commercial development and job creation in the country.”

  • Drama as court nullifies AMCON’s Agbakoba appointment

    The Federal High Court in Lagos nullified yesterday an order appointing a former Nigeria Bar Association (NBA) president, Dr. Olisa Agbakoba (SAN), as the receiver/manager over the assets of Bi-Courtney Ltd, its Chairman Dr. Wale Babalakin (SAN) and three other companies.

    Justice Ibrahim Buba, in a bench ruling, held that the order by his colleague, Justice Okon Abang, was made in error.

    He said the order should not have been made when there were pending cases and subsisting orders on the same case.

    According to Justice Buba, the true facts were not given to Justice Abang.

    “He was misled,” the judge held.

    Agbakoba was also appointed receiver for the assets of Chartered Investment Ltd, Resort International Ltd and Roygate Properties Ltd.

    The Murtala Muhammed Airport 2 (MMA 2) is owned by Bi-Courtney pursuant to a concession agreement with the Federal Government.

    Roygate Properties acquired the old Federal Secretariat building in Ikoyi, Lagos, following another concession agreement between it and the Federal Government.

    The Asset Management Corporation of Nigeria (AMCON), through Agbakoba, applied to the court for orders of possession and receivership over the assets, following the alleged failure of the companies to pay a cumulative debt of about N50billion owed AMCON, which Justice Abang granted.

    Babalakin is chairman of the companies.

    The Chief Judge, Justice Ibrahim Auta, assigned an application by Babalakin to Justice Buba, who was handling previous cases between the parties.

    Justice Buba added that it was clear that AMCON and Agbakoba failed to notify Justice Abang of the existing orders and cases.

    According to him, AMCON acted as if the court “can only bark but not bite”.

    Nullifying Justice Abang’s order, Justice Buba held: “This court has no doubt its process has been abused. It has been misled on the issue of settlement, breaking down and obtaining orders ex-parte, while cases are pending in court, with orders subsisting.

    “Where a court of law feels its orders are irregularly obtained, or its process abused, it shall deal with the process instantaneously, without any formality, to protect its integrity.

    “The order is a nullity, having been obtained ex-parte in the face of subsisting orders already made by this court and also which constitute an abuse of the court process. This court will not suspend it (the order).

    “The court has inherent jurisdiction to deal with abuse of its process and any conduct that impugns its integrity.

    “I so deem and set aside the orders of September 22 made by my brother Abang J. The court was misled. It is within the issues that this court can deal with,” Justice Buba held.

    He urged senior lawyers to avoid misleading the court in a bid to obtain orders, saying a situation where conflicting decisions emanate from the same court is not healthy.

    “The court has to be rightly guided at all times,” he said.

    There was a mild drama after the ruling as lawyers to the parties came outside the courtroom downstairs.

    Babalakin, who was represented by Mr. Wale Akoni (SAN), was discussing with his junior colleagues, apparently the outcome of the case, when Agbakoba called his name “Wale!”

    After calling his name, Agbakoba told Babalakin, who sat in his car while the proceeding was on: “Give me my money!”

    Babalakin responded by saying he would “come after” Agbakoba “personally.”

    Apparently riled, Agbakoba described Babalakin as a “small boy” and referred to his (Agbakoba’s) seniority at the Bar.

    As the two lawyers exchanged words, Akoni and Mr. Biodun Layonu (SAN) tried to calm them.

    Akoni told them to remember that there were reporters around.

    Before the bench ruling, Akoni argued that the integrity of the court had been affected by the conflicting orders, and that there was a serious need for the court to act fast to stop the development.

    Agbakoba said as far as he was concerned, there was no confusion with Abang’s orders.

    He said the suit before Abang was filed pursuant to Babalakin’s alleged admission that he was indebted to AMCON  for N50 billion.

    According to him, Babalakin failed to abide by the term of the agreements, especially as regard transferring the Federal Secretariat in Ikoyi to AMCON as agreed.

    Justice Buba adjourned the matter  till December 9.

  • N50bn debt: AMCON, Bi-Courtney in counter claims

    N50bn debt: AMCON, Bi-Courtney in counter claims

    A former president of the Nigerian Bar Association (NBA), Dr Olisa Agbakoba (SAN), has been appointed as receiver over the assets of Bi-Courtney Limited, Dr.Wale Babalakin (SAN)  and three others.

    The appointment is on the strength  of a motion without notice of September 22 granted by  the Federal High Court in Lagos between Asset Management Corporation of Nigeria (AMCON), Bi-Courtney and three others.

    Four days later, however, Bi-Courtney obtained from another Federal High Court, Lagos,an interim injunction restraining AMCON, Agbakoba and the law enforcement agencies from “commencing, taking and/or continuing any steps or actions to appoint a receiver over,or in any manner howsoever take-over or interfere with the operation and/or control of the MMA2” pending the determination of the substantive suit on the matter.    In the AMCON motion, Agbakoba was also appointed receiver over the assets of Chartered Investment Limited, Resort International Limited and Roygate Properties Limited.

    Bi-Courtney owns the Murtala Muhammad Airport 2 (MMA 2) Ikeja, pursuant to a concession agreement with the Federal Government.

    The Old Federal Secretariat building in Ikoyi Lagos  belongs  to Roygate Properties on account of a separate  concession agreement between Roygate and the Federal Government.

    AMCON, through Agbakoba, had applied to the court for orders of possession and receivership over the assets due to the companies’ alleged failure to pay a cumulative debt of about N50 billion owed it.

    Babalakin is said to have interest in the companies.

    In a statement, Agbakoba said his appointment was by a court order made by Justice Okon Abang on September 22.

    The appointment, he said, is “to realise their assets, enforce the individual liability of the shareholders and directors and to manage the affairs of the above mentioned companies for the purpose of recovering debts owed to AMCON.”

    He warned the public against dealing with the companies except through him.

    “The public is hereby notified not to carry on business with any of these companies without my authority and reference.

    “The public is notified that any person(s) that carries on business with any of the companies without my authority will be liable to contempt of the Orders of Court,” he said.

    Agbakoba also notified all commercial banks of the court order, saying the companies’ accounts remain frozen until the case is determined.

    “The banks are hereby directed not to deal with any of the officers of the above stated companies in relation to operating the companies’ bank accounts in whatever form or description without my authority or reference,” he said.

    According to him, the court also made an order restraining the banks from allowing the companies operate the bank accounts.

    The order, he said, is to subsist until the substantive suit is determined.

    “The Federal High Court has ordered that the banks shall file and serve on Olisa Agbakoba and Associates, within seven days, an affidavit disclosing the balance on all accounts held with your banks jointly and severally as at date.

    “Please note that any bank that acts contrary to the orders of court will be liable to contempt,” Agbakoba added.

    In the counter order,the court directed the defendants particularly AMCON “either by themselves or through  their agents, officers, privies, proxies, assigns, receivers, solicitors or otherwise howsoever, from commencing, taking and/or continuing  any administration or extra judicial steps or actions to seize, freeze, take-over, encumber, undermineand/or interfere with, in any manner  whatsoeverthe assests, bank accounts, business and operations of the applicants and related antities pending the hearing and determination of motion on notice for interlocutory injunction.”

    Joined as defendants in the suit are the Attorney Generl of the Federation, AMCON and the Federal Airports Authority of Nigeria (FAAN).

  • AMCON, Heritage sign initial pact on Enterprise Bank

    AMCON, Heritage sign initial pact on Enterprise Bank

    •’Acquisition ‘ll deepen competition’

    The Asset Management Corporation of Nigeria (AMCON) and Heritage Bank Limited at the weekend signed a Share Purchase Agreement (SPA) that will enable the latter acquire the entire issued and fully paid up ordinary shares of Enterprise Bank Limited.

    Confirming the agreement, a reliable industry source told The Nation that details of the agreement showed that Heritage Bank is expected to make full payment for the lender by October ending.

    Heritage, the source said, has already paid the 20 per cent or N11.2 billion of the N56 billion bid price before the SPA was signed last Friday in Abuja.

    AMCON had in a statement endorsed by its Head, Corporate Communication, Kayode Lambo announced HBCL Investment Services Limited (HISL), sponsored by Heritage Banking Company Limited (Heritage Bank), as preferred bidder while Fidelity Bank Plc was named reserve bidder for the acquisition of the bridged lender.

    The AMCON spokesman said the bid process started with interest shown by 24 parties cutting across local and international boundaries. The emergence of HISL and Fidelity Bank as preferred and reserve bidders respectively, he said, resulted from a rigorous and competitive bidding process, which was coordinated for AMCON by Citigroup Global Markets Limited, Vetiva Capital Management Limited (Financial Advisers) and G. Elias & Co. (Legal Advisers).

    Enterprise Bank commenced operation in August, 2011, as a full-service commercial bank with a national banking license. The bank operates via a sizeable distribution network of over 160 branches spread across major markets and commercial centres in Nigeria, and with over 177 automated teller machines (ATMs), 57 Cash Centres and 2,000 point of sales (PoS) terminals.

    Meanwhile, Managing Director, CRC Credit Bureau, Tunde Popoola said the acquisition, when completed, would improve competition in the banking sector.

    He explained that in acquisition of this nature, there are different things that are involved including the winner’s ability to pay. He expressed optimism that Heritage will be able to muster the required  fund and pay before the deadline expires.

    “Don’t forget that they bided on their own. They provided the value of the bid. Where you are bidding and you are providing amount you want to pay, it then means you have a way of sourcing for that fund. Otherwise, it does not make sense to bid for an amount you will not be able to pay,” he said.

    Popoola said the process has been transparent and winners know the timeline they will be given to pay. He however said the bank must pay without depleting its capital adequacy. “And as a banking institution, they must have the required money without impairing their capital adequacy. If they do not have the means to pay, and the time expires, there is already a reserved bidder,” he said.

    He said should Heritage fail to pay, the right to acquire Enterprise Bank will then go automatically to Fidelity Bank. “If they fail to pay, that goes back to the second bidder who will then pay its bid price. Whichever way it goes, I believe Enterprise Bank will be better for it and the economy will also be better for it because you will see a bank that will run fully with all the potentials,” he said.

  • Banks strategise ahead of N1tr AMCON bonds’ timeline

    Banks strategise ahead of N1tr AMCON bonds’ timeline

    Deposit Money Banks (DMBs) are strtegising to reduce the impact of the N1 trillion Asset Management Corporation of Nigeria (AMCON) bonds on their operations.

    The bonds, maturing next month, are expected to raise the liquidity level in the market and based on analysts’ assessment, it will impact on interbank rates.

    Already, increased government spending ahead of next year’s general elections is taking liquidity pressure on the economy to new heights.

    Head of Research, Standard Chartered Bank, Razia Khan, said the liquidity surge, which set in last month,  was foreseen by the Central Bank of Nigeria (CBN) Monetary Policy Committee (MPC) meeting, hence, the interest rate was left unchanged at 12 per cent.

    “The decision at the last MPC meeting was largely as expected –with all rates kept on hold.  While mention was made of the upward pressure on inflation, with the CBN stating that it would be monitoring liquidity levels, the committee nonetheless restated the Governor’s goal of lower interest rates in the long-term,” she said.

    She said the committee’s position raises key questions around how the CBN might react when liquidity pressures are even more pronounced than they are now.

    “An additional AMCON maturity of just less than N1 trillion is expected in October.  The political season and pre-election spending are likely to build-in intensity from September on,” she said, adding that for now, the foreign exchange rate is stable – reflecting continued inflows into Nigeria.

    Khan said the macro-prudential measures announced by the CBN, the increased capital requirement for Bureau De Change (BDCs) should help at the margin. But global factors will also be keys – with much pointing to a confluence of greater pressures in the fourth quarter of 2014.

    She said while the long-term goal may be lower rates to boost private sector credit, and achieve some level of policy accommodation in order to ‘support’ the real economy, the way in which the CBN chooses to navigate upcoming challenges will be carefully monitored.

    “Maintaining faith in the stability of the foreign exchange rate, even in the face of these challenges, in an environment of low Treasury Bills yields, will be key,” she said.

    The MPC met on July 21 and 22 against the backdrop of continuing quantitative tapering by the US Federal Reserve, which has resulted in the slowing of inflows to emerging markets and frontier economies.

    The committee noted that the rebound in global economic activity strengthened in the first half of 2014; although at levels lower than previously projected.

    The tapered growth arose mainly from the emerging and developing economies owing to the rising real interest rates and geo-political crisis.

    On the whole, the effects of the global financial crisis have continued to wane even as rising income inequality, unemployment and poverty appear to be gaining prominence; engaging the attention of the monetary authorities.

     

  • Nigeria pays N3.4b monthly to Ajaokuta workers, says AMCON chief

    Nigeria pays N3.4b monthly to Ajaokuta workers, says AMCON chief

    •Corporation working with N6tr

    The Chairman of Asset Management Corporation of Nigeria (AMCON), Alhaji Kola Belgore, has said nothing is working in Nigeria because of its wastefulness.

    He said AMCON was the only establishment that was working with over N6 trillion without a kobo missing.

    The former banker decried the collapsed of several industries, firms and banks, which he linked with mismanagement.

    Belgore spoke yesterday in Ilorin, the Kwara State capital, at an award ceremony organised by the state chapter of the Alumni Association of the Nigerian Institute of Policy and Strategic Studies (NIPSS).

    He said the Federal Government was wasting N3.4 billion monthly on Ajaokuta Steel Mill, adding: “That is what we are paying monthly for doing nothing at Ajaokuta.”

    The AMCON chief regretted that despite the huge potential of Ajaokuta Steel Mill, it remained unproductive.

    He said: “There are 2,500 engines mounted and 6,000 employees. We are paying them every month N3.4 billion.

    “I am privileged to be managing AMCON today. It is not noise-making that make people to know youl; it is the output of what you are doing. It is performance. AMCON is the only establishment in Nigeria that has over N6 trillion that it is working with and not one kobo has missed.

    “How we can move the nation forward does not have anything to do with politics. It is a collective interest. If anybody says he is happy with the current situation in the country, that person is playing the fool. We have become a ridiculed nation in the comity of nations. God endowed Nigeria very well with human and material resources. Yet, we are seriously underperforming.

    “Simple ridicule is a nation blessed with petroleum products, yet we are importing fuel, while we are the seventh largest producer in the world.

    “If any of you has ever been to Ajaokuta Steel Company, as an example, and you are a Nigerian patriot, you will shed tears for Nigeria. You will see a gigantic factory without smoke, a factory where we have spent billion of naira.

    “I have travelled round the world and I was in the Manufacturing sector. I have not seen a bigger factory than what we have in Ajaokuta. Yet, it is not producing; nothing is happening and nobody is talking. What kind of country are we? Are we a wasteful country, a country that most people don’t get concerned about what is going on?

    “One of the major problems of Nigeria is unemployment. When all the banks and institutions closed, where will you get jobs for people? We must reverse this trend. Nothing works without planning.”

  • N1tr AMCON bonds,political spending raise market liquidity

    N1tr AMCON bonds,political spending raise market liquidity

    The maturity of N1 trillion Asset Management Corporation of Nigeria (AMCON) bonds by October and increased spending ahead of next year’s general elections are taking liquidity pressure on the economy to new heights, analysts have said.

    Head of Research, Standard Chartered Bank, Razia Khan said the liquidity surge is likely to set in by September, and that the decision from the last Central Bank of Nigeria (CBN’s) Monetary Policy Committee (MPC) meeting was to check the trend.

    “The decision at the last MPC meeting was largely as expected -with all rates kept on hold.  While mention was made of the upward pressure on inflation, with the CBN stating that it would be carefully monitoring liquidity levels, the committee nonetheless restated the Governor’s goal of lower interest rates in the long-term,” she said.

    She said the committee’s position raises key questions around how the CBN might react when liquidity pressures are even more pronounced than they are now.

    “An additional AMCON maturity of just less than N1 trillion is expected in October.  The political primary season and pre-election spending are likely to build in intensity from September on,” she said adding that for now, the foreign exchange rate is stable – reflecting continued inflows into Nigeria.

    Khan said the macro-prudential measures announced by the CBN, the increased capital requirement for Bureau De Change (BDCs), should help at the margin. But global factors will also be keys – with much pointing to a confluence of greater pressures in fourth quarter of 2014.

    While the long-term goal may well be lower rates to boost private sector credit, to achieve some level of policy accommodation in order to ‘support’ the real economy, the way in which the CBN chooses to navigate upcoming challenges will be carefully monitored.

    Maintaining faith in the stability of the FX rate, even in the face of these challenges, in an environment of low T-bill yields will be key.

    The Monetary Policy Committee (MPC) met on July 21 and 22, 2014 against the backdrop of continuing quantitative tapering by the U.S Federal Reserve which has resulted in the slowing of inflows to emerging markets and frontier economies; and the attendant uncertainties in the outlook for monetary policy and financial stability in the post-tapering period.

    The Committee noted that the rebound in global economic activity strengthened in the first half of 2014; although at levels lower than previously projected.

    The tapered growth arose mainly from the emerging and developing economies owing to the rising real interest rates and geo-political crisis. On the whole, the effects of the global financial crisis have continued to wane even as the issues of rising income inequality, unemployment and poverty appear to be gaining prominence; engaging the attention of the monetary authorities.

    These latest projections indicate that the euro area is gradually coming out of recession, as growth projection for 2014 is positive for all member countries albeit with significant variation.