A New helmsman has taken over at Skye Bank Plc. Mr Adetokunbo Abiru, a Harvard Business School graduate who headed Investment Banking at First Bank of Nigeria Ltd., is the Managing Director/CEO.
Central Bank of Nigeria (CBN) Governor Godwin Emefiele announced the management and board changes, which led to the resignation of Group Managing Director Timothy Oguntayo and Chairman Olatunde Ayeni.
Muhammad K. Ahmad, the pioneer Director-General/CEO of the National Pension Commission (PENCOM), is the chairman.
Emefiele, who announced the changes at a media briefing in Lagos, said the regulatory action followed poor liquidity ratio and capital adequacy hitches, as well as rising cases of non-performing loans found to be hurting the lender’s balance sheet positions.
He said the apex bank decided to act before the problems confronting the lender reached an irreversible state, adding that the appointments are solely to ensure a speedy restoration of the health of the lender.
Emefiele also announced the sacking of all non-executive directors and independent directors on the board of the bank as well as the deputy managing director and the two longest-serving executive directors. But the more recently appointed executive directors will remain to ensure continuity and smooth transition.
“These proactive moves have become unavoidable in view of the persistent failure of Skye Bank Plc to meet minimum thresholds in critical prudential and adequacy ratios, which has culminated in the bank’s permanent presence at the CBN lending window. In particular, Skye Bank’s liquidity and non-performing loan ratios have been below and above the required thresholds, respectively, for quite a while,” Emefiele said.
According to Emefiele, the CBN had several meetings with the management and board of the bank as part of its strategy of close engagement whenever a bank’s financial or governance situation poses potential threats to the overall stability of the financial system.
“Despite the expectation of relevant regulators, market watchers, financial analysts and interested stakeholders that Skye Bank should be doing much better than it is right now, we have seen about the opposite in reality,” he said.
Emefiele assured customers and other stakeholders that Skye Bank is not in distress and remains healthy. He said although the bank’s liquidity ratio had been badly hurt, it is not at a point where depositors’ funds are threatened.
“The CBN hereby assures depositors, shareholders and all relevant stakeholders that there is no reason for concern or panic as we seek their continued cooperation at this time. It is our expectation that the shareholders and remaining executive directors will work seamlessly with the new team to ensure that the fortunes of the bank are restored in the shortest possible time,” he said.
Emefiele explained that since Skye Bank is a domestic Systematically Important Bank (SIB) with significant interconnectedness, the CBN would be failing in its duties if it does not take immediate action to nip the steadily declining health of the bank in the bud and correct the situation.
“In view of the long grace period allowed the bank to correct the situation, we came to the conclusion that although the existing board had done its best to steer the ship, it had come to a realisation that it would be unable to bring the bank out of its present precarious situation. Fortunately, and in the overall interest of the bank, the Chairman and some board members have decided to resign their appointments from the bank,” he said.
Ahmad is a seasoned public sector executive with over 35 years of distinguished experience spanning the public sector and the financial services industry. He is a pioneer member of the staff of the Nigeria Deposit Insurance Company (NDIC) where he became a director.
He has been on the board of various companies and committees, including banks and not-for-profit organisations.
Abiru, an accountant, was Lagos State Commissioner for Finance from 2011 to 2013 and is a Fellow of the Institute of Chartered Accountants of Nigeria (ICAN).
Ahmad in a statement expressed optimism about the bank, given its vast potentials and strategic position in the economy. He stated that the bank is well positioned to deepen the retail and commercial banking services in the economy, having put in place the critical building blocks to win in this sector.
He stated that the immediate priorities of the board and the new management team is to quickly begin to leverage the huge investment in the enhanced branch network, technology and alternative channels to improve stakeholder value in a sustainable manner.
He assured the shareholders, customers and depositors of the bank of his commitment to preserve their investments and deposits, while further assuring that the support and backing of the CBN and other relevant stakeholders have been obtained in this respect.
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