Lamido who spoke in an interview with CNBC Africa Television also said that he would be satisfied with 9.0_9.5 per cent inflation rate inthe country and that creating economic growth was the priority of CBN.
He said in the television interview: “When you have a country of 150 million people with 70 percent below the poverty line, it is extremelyimportant to provide a stable environment to ensure that growth of theeconomy is not hampered by some desire to pursue a very lowsingle_digit rate of inflation.
Lamido Sanusi
“We have brought inflation down in the last one year, from 16 per cent to 10 per cent. We think we can do single digits and that is goodenough, nine or 9.5 per cent, would do for me.”
Sanusi who said that two foreign institutions were involved in the bidding process for the rescued banks, as well as several local banksand private equity firms in partnership with foreign banks, added: “Theadvisers have finished analysing bids already received for four of thebanks. We expect the bids for the others to have been completed by theend of this month.”
He, however, gave no further details as to who the bidders were.
The nine rescued banks are Afribank, Bank PHB, Equitorial Trust Bank, Finbank, Intercontinental Bank, Oceanic Bank, Spring Bank andUnion Bank. Wema Bank and Unity Bank were also judged to haveinsufficient capital but did not receive an emergency cash injectionbecause it had a healthy liquidity position.
Foreign banks
The foreign banks that had openly expressed interest in investment opportunities in Nigeria include South Africa’s First Rand, StandardBank and Nedbank. Nigerian banks considering a bid for a rescued peerinclude First Bank, Fidelity Bank, Skye Bank and Diamond Bank.
Chief Executive of Fidelity Bank, Mr. Reginald Ihejiahi, told CNBC Africa television recently: “We need more distribution, we need morecontact points with our customers. The institutions we are interestedin are institutions that have the retail network.”
Vanguard gathered that CBN and Ministry of Finance were in the process of finalising the setting up of an asset management company,AMCON, which would purchase non-performing loans with collateral andchase the recovery of the bad loans in the rescued banks. AMCON wouldalso inject funds and take equity stakes if there were unsecured loanswhich needed absorbing.
Sanusi said much work had been done in the last month to value the bad loans and gauge how much of them were unsecured..
He said a recommendation had been made to the President on the constitution of AMCON’s board and was confident that once that wasapproved, deals to buy non-performing loans from the rescued bankscould quickly be announced.
Sanusi said: “I don’t see any reasons why AMCON can’t take these decisions in the next few weeks,” noting that the recovery of badassets would take much longer.
He added: “As far as the details are concerned, it will take a year togo and audit every asset, to do every valuation, do legal duediligence, set up systems and processes.”
Interest rates have been on hold at 6.0 per cent for more than a year and inflation is in double digits.
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