Bloomberg News

First City Nigeria Shareholders Approve Takeover of FinBank

September 29, 2011

(Updates with Finbank approval in second paragraph.)

Sept. 29 (Bloomberg) -- First City Monument Bank Plc of Nigeria shareholders approved the acquisition of FinBank Plc a day before the central bank recapitalization deadline for bailed-out lenders, First City Chairman Jonathan Long said in Lagos.

FinBank’s investors consented to the takeover at a separate meeting today in Abuja, the capital, Theo Chike Osanakpo, chairman of the lender, told reporters.

“The steps taken today will create some measure of value to the shareholders that has the potential to be enhanced upon with this new arrangement,” Osanakpo said.

The Lagos-based lender was one of eight banks whose top executives were fired by the Central Bank of Nigeria after loans to equity speculators contributed to non-performing debt that put the banking industry on the verge of collapse. The lenders were bailed out by the central bank two years ago with the injection of 620 billion naira ($4 billion). Regulators gave the lenders until Sept. 30 to recapitalize.

Three lenders, Afribank Plc, Bank PHB Plc and Spring Bank Plc were nationalized by the government on Aug. 5 after they were deemed unlikely to meet the recapitalization deadline.

First City’s shares gained the most in two months, trading 4.9 percent higher at 4.06 naira by the close in Lagos. The stock’s 46 percent decline this year outpaces the Nigerian Stock Exchange All-Share Index’s 19 percent drop.

--Editors: Emily Bowers, Dulue Mbachu.

To contact the reporter on this story: Emele Onu in Johannesburg at eonu1@bloomberg.net To contact the reporter on this story: Elisha Bala-Gbogbo in Abuja at ebalagbogbo@bloomberg.net

To contact the editor responsible for this story: Dulue Mbachu at dmbachu@bloomberg.net


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