Nigeria's Securities and Exchange Commission (SEC) said on Sunday it had suspended trading on the shares of Afribank, Spring Bank and Bank PHB , following the nationalisation of the three lenders. SEC also approved a technical suspension on the trading of Finbank, Intercontinental, Oceanic Bank and Union Bank shares, pending the completion of agreed re-capitalisation deals.
Technical suspension means that trading on the shares can continue without any change in price. The Nigerian central bank revoked the licences of Afribank, Spring Bank and Bank PHB on Friday because it said they did not show the necessary capacity to re-capitalise following a $4 billion bailout of nine lenders in 2009.
The central banks set up "bridge banks" to acquire the assets and liabilities of the failed lenders, who were then sold to state-owned asset management company AMCON.
The state 'bad bank' said on Saturday it plans to re-capitalise the failed banks and run them for a period of 2-3 years before finding suitable investors.
AMCON was set up last year to absorb bad bank loans, exchanging them for government-backed bonds, with the aim of rebuilding commercial bank balance sheets.
In 2009, the central bank bailed out nine banks that auditors deemed to be so badly capitalised they posed a risk to sub-Saharan Africa's second-largest economy. The banks were poorly managed and had over exposure to the capital and oil markets during the global financial crisis.
Finbank, Intercontinental, Oceanic and Union have signed re-capitalisation agreements with new investors.
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