• Buhari appoints new GMD NNPC

Central Bank of Nigeria, CBN, has announced the sack of key personnel on the Board and Management of Skye Bank after it failed to meet minimum capital ratios, its governor said yesterday.
Those affected are the chairman, all non-executive directors on the board as well as the managing director, deputy managing director, and the two longest-serving executive directors on the management team.
Also, President Muhammadu Buhari yesterday announced the appointment of Dr. Maikanti Kacalla Baru as the new Group Manageming Director of the Nigeria National Petroleum Corporation, NNPC.
The CBN wielded the sledge hammer because of persistent failure of Skye Bank to meet minimum thresholds in critical prudential and adequacy ratios, which has culminated in the bank’s permanent presence at the CBN Lending Window.
A statement issued yesterday in Abuja by the Acting Director, Corporate Communications, CBN, Mr. Isaac Okorafor justifying the apex bank’s action stated “in particular, Skye Bank’s Liquidity and Non-performing loan Ratios have been below and above the required thresholds, respectively, for quite a while.”
The CBN explained that the proactive moves taken have become unavoidable to correct the anomalies in the bank, stressing that the “CBN had several meetings with the management and board of Skye Bank as part of our strategy of close engagement whenever a bank’s financial or governance situation poses potential threats to the overall stability of our 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.”
The CBN added “given the aforementioned issues and the fact that 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 realization 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.
“Consequently, by virtue of the powers vested in the Governor of the CBN, we have decided to reconstitute the Board and Management of the bank, and appoint new members with the sole responsibility of ensuring the speedy restoration of the health of the bank.
“To this effect, the Chairman of the Board, all other Non-Executive Directors, the Independent Director, the Managing Director, the Deputy Managing Director and two longest serving Executive Directors have voluntarily resigned their appointments with immediate effect. In their place, we have selected industry experts and people of high integrity whom we believe can turn the bank around.
“In this regard, we have selected Alh. M. K. Ahmad to be the new Chairman while Mr. Adetokunbo Abiru would be the new Managing Director. The more recent executive directors will be allowed to remain to ensure continuity and a smooth transition.
“As some of you may know, Alh. M. K. Ahmad is a seasoned public sector executive with over 35 years of distinguished experience spanning the public sector and the financial services industry. He served as the pioneer Director General and Chief Executive Officer of the National Pension Commission (PENCOM). He was also a pioneer staff of the Nigeria Deposit Insurance Company (NDIC) where he rose to become a Director. He has also served on the Board of various companies and committees including banks and not for-profit organizations. Similarly, Mr. Abiru is a seasoned accountant and banker and was until recently an Executive Director in First Bank PLC. He was also Lagos State Commissioner of Finance from 2011 to 2013. Mr. Abiru is a Fellow of the Institute of Chartered Accountants of Nigeria.”
In the medium-term vision of the CBN, which was unveiled in June 2014, it indicated that the bank would proactively manage potential threats to financial stability, maintain zero tolerance on practices that undermine the health of financial institutions, and create a strong governance regime that is conducive for financial intermediation, innovative finance and inclusiveness.
Mr. Okorafor stressed that “it is in furtherance of these commitments that the CBN has made the changes and assures the incoming Board and Management of its unflinching support during this transition period.
“It is important to reiterate the fact that Skye Bank is not in distress and remains a healthy bank in the system”
The CBN assured depositors, shareholders and all relevant stakeholders that there is no reason for concern or panic as it 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,” said Mr.Okorafor.
The CBN’s Governor, Mr. Godwin Emefiele at a briefing in Lagos said “The basic issue is capital adequacy and liquidity. From what we see, adequacy ratio in the bank has been weakening and we don’t want it to get to a point where depositors will be at risk.”
Skye Bank is designated as one of Nigeria’s systemically important banks due to the size of total sector deposits it holds after the acquisition of Mainstreet Bank. This means it has to hold more capital.
Emefiele said the CBN had conducted a stress test and decided to replace the chairman, chief executive and all non-executive directors after they failed to recapitalise the bank, stressing”(Skye) bank is not in distress and remains able to continue banking activity.”
The CBN has powers to remove bank executives. During the 2008/2009 global financial crisis, it sacked nine CEOs at banks which were undercapitalised.
Last year, the regulator gave three commercial banks until June 2016 to recapitalise after they failed to hit a minimum capital adequacy rate of 10 percent.
Skye Bank has been in talks with shareholders and new investors to raise N30 billion ($150 million). It suspended plans for a rights issue last year due to weak market conditions.

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Buhari appoints new GMD NNPC
In a related development, Presidant Muhammadu Buhari has removed Dr. Emmanual Ibe Kachikwu as the Group Managing Director of Nigerian National Petroleum Corporation NNPC, in a sweeping reorganisation carried out yesterday.
He also constituted a new board which retained Kachikwu as Minister of State for Petroleum Resources. The new board is composed of the following: Chairman-Dr Emmanuel Ibe Kachikwu, Honourable Minister of State for Petroleum; Group Managing Director- Dr. Maikanti Kacalla Baru. President Buhari also appointed Permanent Secretary of the Federal Ministry of Finance as a member of the board and following six persons: Mallam Abba Kyari, Dr Thomas M.A John, Dr Pius O. Akinyelure, Dr Tajuddeen Umar.Mallam Mohammed Lawal, and Mallam Yusuf Lawal.
He urged the new board to ensure the successful delivery of the mandate of the NNPC, “ and serve the nation by upholding the public trust placed on them in managing this critical national asset.”
NNPC confirmed in a telephone interview that the Presidency has posted the news about the restructuring in the media.
Before his appointment Dr. Baru had worked in various capacities in both the Upstream and Downstream Sectors of NNPC. These includes Group General Manager of Greenfield Refinery Projects, Managing Director of Hyson, Executive Director of Nigerian Gas Company (NGC), General Manager – Gas Division of NAPIMS, Manager – Operations, Procurement Management Services and Manager – Engineering for National Engineering and Technical Company Limited (NETCO).
He was also the NNPC’s Chief Technical Negotiator on the West African Gas Pipeline project from July 1999 to April 2004.
Dr. Baru has been the Chairman of NNPC Anti – Corruption Committee since September 2004 till date; and has relentlessly sensitized staff on obligations and laws that govern corruption and corrupt practices.
Dr. Baru is a fellow of the Nigerian Society of Engineers(FNSE) and a recipient of the Presidential Merit Award of theNigerian Society of Chemical Engineers. He is married with children.

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