After months of speculation, Access Bank has finally acquired Diamond Bank, financial insiders say.
TheCable reports that the official announcement of the transaction will be made in the course of the week by the Central Bank of Nigeria (CBN).
The acquisition was supervised by the CBN in a bid to further consolidate the banking industry.
Meanwhile, a Diamond Bank official has reacted to the takeover, saying there was no need for the public to panic as “the bank is in safe hands”.
Last week, Diamond Bank announced its decision to drop its international operating licence to focus on national operations following capitalisation issues.
Uzoma Dozie, the bank’s chief executive officer, had confirmed in a statement released on Friday that it would cease to operate as an international bank.
“The re-licensing as a national bank supports Diamond Bank’s objective of streamlining its operations to focus resources on the significant opportunities in the Nigerian retail banking market, and the economy as a whole,” he had said in a statement.
“The move follows Diamond Bank’s decision to sell its international operations, which included the disposal of its West African Subsidiary in 2017 and Diamond Bank UK, the sale of which is currently in its final stages.
“The change to national bank status also enables the bank to maintain a lower minimum capital requirement of 10 per cent, as against 15 per cent required for international banks.”
The bank recorded its worst month on record in November with share plunging to 0.61k per unit on November 30, 2018.
Diamond Bank Q3 2018 report had showed that the bank was under some financial stress with profit after tax falling from N3.9 billion in 2017 to N1.6 billion.
This impacted the bank’s earnings per share, which also dropped sharply from N17 in 2017 to N7 in 2018.
Apart from dealing with non-performing loans, the bank also had to contend with a fine from the Central Bank of Nigeria in August for allegedly aiding MTN Nigeria to illegally repatriate $8.1 billion.
Following the problems bedevilling the bank, Oluwaseyi Bickerseth, the bank’s chairman who was appointed in July, and three non-executive directors resigned in October.
Also, S&P Global Ratings downgraded the bank’s rating to CCC+/C from ‘B-/B’ and its Nigeria national scale ratings to ‘ngBB-/ngB’ from ‘ngBBB-/ngA-3.
The agency said the bank is “dependent on favourable business, financial, and economic conditions to meet its financial obligations”.