CBN-Polaris Bank sold to SCIL for N50bn

Precious Yusuf 

The Central Bank of Nigeria (CBN) and the Asset Management Company of Nigeria (AMCON) formally announced the Share Purchase Agreement (SPA) had been completed  for the acquisition of 100 percent of the government’s equity in Polaris Bank by Strategic Capital Investment Limited (SCIL).

The House of Representatives on Wednesday,October 19th, confirmed the sale of the bank, noting that the acquisition followed all laid down procedures and getting the relevant presidential approval. 

In a statement issued by the Director, Corporate Communications Department at the Central Bank of Nigeria (CBN), Osita Nwanisobi, on behalf of the CBN and AMCON, it was disclosed that SCIL had made an upfront payment for consideration of N50 billion to acquire 100 percent  of the equity of Polaris Bank. 

They had also accepted the terms of the agreement which included the full repayment of the sum of N1.305 trillion, being the consideration bonds injected. 

According to the statement, “the CBN thus received an immediate return for the value it has created in Polaris Bank during the stabilisation period, as well as ensuring that all funds originally provided to support the intervention are recovered.”

“The sale was coordinated by a Divestment Committee (the ‘Committee’) comprising representatives of the CBN and AMCON, and advised by legal and financial consultants. The Committee conducted a sale process by ‘private treaty’, as provided in Section 34(5) of the AMCON Act to avoid negative speculations, retain value and preserve financial system stability.   

“In the process, parties who had formally expressed an interest in acquiring Polaris Bank, subsequent to the CBN intervention in 2018, were invited to submit financial and technical proposals. Invitations to submit proposals were sent to 25 pre-qualified interested parties, out of which three (3) parties eventually submitted final purchase proposals following technical evaluation. 

“All submissions were subject to a rigorous transaction process from which SCIL emerged as the preferred bidder having presented the most comprehensive technical/financial purchase proposal as well as the highest rated growth plans for Polaris Bank,” the statement read. 

Also the CBN Governor, Mr. Godwin Emefiele, was quoted as saying that the sale of the bank was going to be the beginning of good things in the banking sector in Nigeria. 

“This acquisition marks the completion of a landmark intervention in a strategic institution in the Nigerian banking sector by the CBN and AMCON.”

Meanwhile, Polaris has been operating as a bridge bank since 2018 when the Central Bank of Nigeria intervened to revoke the licence of the former Skye Bank Plc and established Polaris Bank to assume its assets and certain liabilities.