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Depositors’ Funds safe, Employees of Skye Bank to be retained by Polaris Bank, CBN Assures

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The Central Bank of Nigeria (CBN) has assured that all employees of now defunct Skye Bank are to be absorbed by the new Polaris Bank under a new contract unless any employee decides to opt out. Also, the CBN declared that all depositors shall retain their deposits and that normal banking services shall continue in the new bank on Monday, 24th September 2018, to enable customers transact their businesses seamlessly.

Since the announcement of the revocation of the operating license of Skye Bank less than 24 hours ago, there have been agitations especially on social media about the fate of employees and depositors.

While announcing the new development, the CBN Governor, Godwin Emefiele gave reasons for the revocation and specifically said: “We wish to assure all depositors that under this arrangement, their deposits shall remain safe and that normal banking services shall continue in the new bank on Monday, 24th September, 2018, to enable customers to transact their businesses seamlessly.

Thus, all customers of Skye Bank shall be automatic customers of the new bank and their accounts and records duly purchased by Polaris Bank.

Given the good performance of the board and management, the CBN shall retain them. In addition, all employees of Skye Bank shall be absorbed by Polaris Bank under a new contract unless any employee decides to opt out.

We wish to assure the general public that the Nigerian banking industry remains safe and resilient and that the CBN will continue to live up to its responsibilities of promoting stability in the banking and financial system.”

Emefiele

Polaris is a bridge bank set up in concert with NDIC and AMCON and the unveiling was a guarded secret until Emefiele’s announcement in Lagos on Friday.  According to Emefiele,  the bridge bank, Polaris Bank will be getting a single digit interest long term facility of N786 billion from the Assets Management Corporation of Nigeria (AMCON).

The winding up of the bank came five months after the CBN renewed the mandate of the board of the for an additional two years.  Emefiele passed a confidence vote on the  board and said it  shall continue to run the bank.

The bank’s board comprises Mr Muhammad Ahmad and Mr Tokunbo Abiru, Chairman and Group Managing Director respectively.

The CBN back in April  also said the board was given a new two-year term to turn around the operations of the bank.

“In the two years of the board’s mandate, the team has stabilised the institution, entrenched sound corporate governance and risk management practices, and restored depositors’ confidence.

“In recognition of the stellar performance of the board, the CBN has renewed the Board’s mandate for an additional two-year term till 30th June, 2020.

“We wish to assure the Bank’s shareholders and stakeholders of the commitment of its board and Management, working with the CBN, to conclude various initiatives to achieve a positive turn around for the bank and deliver value to its stakeholders.”

Also, the Managing Director and Chief Executive of Nigerian Deposit Insurance Corporation (NDIC), Alhaji Umaru Ibrahim said the option of a bridge bank was to ensure that the depositors of the bank are taken care of and deposits are not lost.

Ibrahim said that the bridge bank would also ensure that there would be no job losses as Polaris Bank would retain all staff of the distressed bank under a new contract.

About Charles Igbinidu

Charles Igbinidu is a Public Relations practitioner in Lagos, Nigeria

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