The attention of the Central Bank of Nigeria (CBN) has been drawn to a spurious,
malicious, and misleading online publication, which made several false claims
concerning the recent sale of the Federal Government’s interest in Polaris Bank Ltd.
Given the potentially grave implications for the stability of the bank, financial sector and
the Nigerian economy, the CBN is constrained to correct these inaccuracies.
For the records, the public is referred to the statement dated October 20, 2022 by CBN
& AMCON announcing the sale of 100% equity in Polaris Bank to a new core investor,
Strategic Capital Investment Limited (SCIL), wherein it provided copious details of the
process by which the sale was conducted.
Contrary to claims in the aforementioned online publication, the divestment from Polaris
Bank was supervised by a Divestment Committee (Committee) comprising senior
representatives of AMCON & CBN and supported by reputable legal and financial
advisers. In addition, the divestment mode, process and decision received requisite
board and regulatory approvals.
At no time did any other party make a higher purchase offer as falsely claimed by the
online publication. The entity in question, Fairview Acquisition Partners, had indicated
an interest in acquiring two banks, including Polaris Bank, for a total sum of N1.2
trillion, an indicative offer which significantly discounted the existing N1.305 trillion debt
owed by Polaris Bank to AMCON and so represented a material loss to the Federal
Government. Notwithstanding, along with twenty-four (24) other parties, Fairview
Acquisition Partners was invited by the financial advisors to participate in the sale
process via the execution of a Non-Disclosure Agreement (NDA), the first stage of the
process. The financial advisors informed the Committee that Fairview Acquisition
Partners neither executed nor returned the NDA despite verbally confirming receipt of
the agreement and after follow-up from the financial advisors. Therefore, Fairview
Acquisition Partners did not take the opportunity to update their offer by participating in
the divestment process and thus did not make a binding purchase offer for Polaris
Bank.
The divestment was executed based on the relevant laws, global best practices for bank
resolutions, and requisite regulatory approvals. The Committee, along with its legal and
financial advisers, conducted a rigorous technical and financial evaluation of the
purchase proposals, assessing promoters’ fitness and propriety, offer price received vs.
reserve price, funding structure and financial capacity, strategy and growth plans,
amongst others.
Following evaluation, the promoters of the strategic purpose vehicle, SCIL, emerged as
the preferred purchaser, having presented the most comprehensive technical/financial
purchase proposal and the highest-rated growth plans for Polaris Bank. In addition to
Classified as Confidential
passing all fitness and propriety tests, the promoters also made the highest financial
offer for the bank, which was significantly above its core valuation and reserve price.
SCIL’s binding offer involved an immediate upfront consideration of N50 billion and full
responsibility for the debt of N1.305 trillion owed to AMCON, essentially a total
purchase consideration of N1.355 trillion. This offer was the most competitive and
provided taxpayers and the Federal Government with more than full recovery of its
intervention cost. By the sale, the CBN and Federal Government achieved a successful,
value-driven resolution of a strategic financial institution.
This curiously-timed online publication deliberately misrepresents the circumstances
surrounding the sale of a strategic asset of the Federal Government. Its misleading
statements are obviously intended to undermine the credibility of the divestment
process. It also portends negatively on the stability of Polaris Bank and risks derailing
the progress made by the monetary authorities.
We reiterate that the divestment from Polaris Bank was an institutional decision
supervised by a Committee comprising senior representatives of AMCON & CBN,
coordinated through reputable legal and financial advisers and approved by the
respective leadership and boards of the two institutions.
The CBN remains resolute in pursuing its mandate to promote a safe and sound
financial system in Nigeria.
This is for the records and attention of the general public.
