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CBN, SEC urged to compensate shareholders of nationalised banks

Chief Executive Officer, Standard Union Securities Ltd., Mr Sehinde Adenagbe, has called on capital market regulators to compensate shareholders of the three banks nationalised in 2011.

Adenagbe said in Lagos that the compensation would enhance the participation of local investors in the capital market. The stockbroker said that such a monumental loss without compensation could discourage local investments.

He urged the Securities and Exchange Commission (SEC), the Nigerian Stock Exchange (NSE) and the Central Bank of Nigeria (CBN), to revisit the issue. The shareholders should not be allowed to suffer for the offence of others.

“The capital market regulators should provide succour and not allow the investors to suffer a total loss,” he said. According to Adenagbe, the development may be the reason for poor participation of local investors in the nation’s bourse.

He, however, lauded the apex bank for the increased confidence by foreign investors in the capital market, due to strong fundamentals posted by Nigerian banks.

“The absorption of bank non-performing loans by the Asset Management Corporation of Nigeria (AMCON) has made Nigerian banks stronger and better,” he added.

It will be recalled that in August 2011, CBN revoked the licences of Afribank, Spring Bank and Bank PHB, for failure to show commitment to the process of recapitalisation. Consequently, the affected banks were taken over by AMCON as part of efforts to ensure that the banks continued to operate under new identities. As a result, Afribank Nigeria Plc became MainStreet Bank Plc., Bank PHB became Keystone Bank Plc., while Spring Bank Plc became Enterprise Bank Plc.


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