Deputy Governor, Financial Sector Surveillance, says Central Bank of Nigeria CBN, Dr. Kingsley Moghalu on Monday said that the banking industry will experience the merger of ten banks in a matter of weeks while two Islamic banks will likely open shop before the end of the year.

“About” five bank mergers will take place in the next couple of weeks, to be followed by two or three more in the “near future,” Moghalu said in London in an interview with Bloomberg.

In bid to sanitise the industry the apex bank introduced a number of reform measures including the sack of executive management of eight banks and the injection of N620 billion bailout fund. The eight banks are expected to seek fresh capital injection which maybe through a core investor or through merger and acquisition. Commenting on the reform, Moghalu said “It’s going very positively,” adding that “Nigeria is a case of very innovative” reforms and is “ahead of the curve and confidence is returning to the banking system, though we are not out of the woods yet,” he said

Last year some investors including some local banks submitted bids for the recued banks and it is expected that before the second half of the year, the merger or acquisition of the banks would have been completed. Unconfirmed reports says Vine Capital will sign an agreement to buy Afribank Nigeria Plc, Access Bank Plc will invest in Intercontinental Bank Plc, while First Bank of Nigeria Plc will take a stake in Oceanic Bank International Plc. First City Monument Bank Plc plans to invest in Finbank Plc, and Capital Alliance will sign an agreement with Union Bank of Nigeria Plc, it said.

Moghalu also said that two or three “conventional banks” have expressed interest in opening “Islamic windows,” He declined to name the banks.

“We recognize Islamic finance is a very helpful system and we want to develop it,” he said at a conference in London. “Nigeria is a huge potential market. We have about 70 percent of the population who are unbanked. In the north you have a very, very strong market, people are yearning for this.”