The Asset Management Corporation of Nigeria (AMCON) made a total sum of N183 billion from the sale of two of the three bridged banks – Mainstreet Bank Limited and Enterprise Bank Limited, we learnt yesterday.

While Skye Bank, which bought Mainstreet Bank, paid N126.8billion, Heritage Bank Limited that purchased Enterprise Bank, forked out N56.1billion on the deal.

Although the pair have got all approvals, including that of the Central Bank of Nigeria (CBN), for the transaction, they are still awaiting the endorsement of the Securities and Exchange Commission (SEC), whose Director General, Ms Arunma Oteh, is currently out of the country.

Managing Director, AMCON, Mustafa Chike- Obi, gave an update on the transaction on the bridged banks yesterday in Lagos at the presentation of AMCON series V Bonds Completion meeting, which had in attendance the registrars of the bonds and other experts hired by the corporation. Skye Bank had on October 9 paid the mandatory deposit of 20 per cent for the acquisition of Mainstreet Bank.

The payment of the 80 per cent balance was done last week. Heritage Bank’s investment arm, HBCL Investment Services, had also paid 20 per cent out of the N56.1billion on October 5 and completed the payment of the 80 per cent balance of N44.8 billion on October 15.

Speaking on the bond redemption, Chike-Obi said the corporation had completed the scheduled redemption of the AMCON Series V N976, 042,060,000 Zero-Coupon Bonds (“the Series V Bonds”) due October 2014, at par. Last December, AMCON had redeemed its issued Series I, II, III and IV Bonds totalling N1trillion. With the redemption of these bonds, there is no other bondholder apart from the CBN and this has automatically reduced AMCON’s outstanding bonds due for redemption over 10 years to N3.8 trillion.

The AMCON boss said the corporation had fully retired a total of N1, 874,379,519,000 of all bonds issued since inception. He said: “This puts it ahead of its planned redemption schedule, as all its publicly held bonds have been redeemed before the end of its fourth full year of operations. AMCON had issued zero coupon bonds with a face value of N5.67 trillion as Series I, II, III, IV and V between December 2010 and December 2011.

“The Series V redemption was financed utilising AMCON’s internally generated cash flows and the Banking Sector Resolution Trust Fund (“the Sinking Fund”). The Sinking Fund is funded by annual contributions from the Nigerian Deposit Money Banks and the Central Bank of Nigeria (CBN). AMCON would like to note that the collaboration and support of the CBN was critical in ensuring the success of the process.”

An elated Chike-Obi, who noted that no financial institution in Nigeria has retired such a huge bond in such a short time, said every bond holder had received full value and confirmed the receipt of the funds. Responding to the expected excess liquidity injected into the economy through the redemption of the bonds, Chike-Obi said the CBN had long being informed, stressing that the regulator has all it takes to put liquidity under control.

Besides, he explained that since most of the payments were made with treasury bills, he has confidence that the banking watchdog will manage the liquidity. On the workers of the bridged banks that are kicking against the sale of the banks, he said AMCON was very sympathetic and would engage them but that would not hinder the sale of the institutions. “We are very sympathetic to the workers.

We will talk to them and listen to their concerns but we don’t see them stopping the sale of the banks. “When we came in, we said we will get out of these institutions as soon as possible. Remember that the sale of Enterprise Bank started about year ago,” he said.

Also speaking on the bond redemption, AMCON’s Executive Director, Finance & Corporate Services, Mrs. Mofoluke B. Dosumu, said: “The redemption represents a major milestone in the reduction of AMCON’s obligations, as it signifies the retirement of all AMCON bonds held by the public markets. We will continue to make good progress with respect to our obligations to the Central Bank of Nigeria, presently the sole holder of AMCON’s outstanding debt obligations.”

Three lenders – Mainstreet Bank, Enterprise Bank and Keystone Bank and were acquired by AMCON following the inability of the trio to recapitalise within a specified timeframe set by CBN.

Mainstreet Bank was formerly known as Afribank; Keystone Bank was previously known as Bank PHB while Enterprise Bank was before its acquisition, known as Spring Bank. AMCON had injected N679 billion into the hitherto sick banks to meet the minimum capital base of N25 billion and the minimum capital adequacy ratio of 15 per cent, as stipulated by the banking watchdog. And in a bid to recover these funds, which it raised through issuance of bonds, the corporation has sold two of the lenders, starting with Enterprise Bank and Mainstreet Bank. The sales process for Keystone Bank will be completed next year.