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Why CBN took over Skye Bank – reasons never to forget

The Central Bank of Nigeria took over the Board and management of Skye Bank Plc today (July 4, 2016) after the bank failed to turn the bank’s fortunes around despite several warnings from the apex bank.

This follows the resignation of the bank’s Chairman, Chief Tunde Ayeni, and Management Director/Chief Executive Officer, Mr. Timothy Oguntayo.

The CBN also installed Alhaji MK Ahmad as the new chairman, while Mr. Tokunbo Abiru is the new MD/CEO.

The CBN Governor, Mr. Godwin Emefiele also urged shareholders and customers of the bank to remain calm as the bank was not in distress.

Here is the nitty-gritty of the issues that led to the takeover of the bank…

The bank is one of nine commercial banks the Central Bank of Nigeria wrote letters to in November 2015 with serious issues with their liquidity.

The bank failed repeatedly to meet the minimum key liquidity and capital adequacy ratios forcing the CBN to intervene in order to protect depositor’s funds before they are eroded.

The bank found itself in the precarious position due to many bad debts it was owed running into billions of Naira.

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