Yesterday a banking source of Business Insider published the article about the intentions of Access Bank to acquire Diamond Bank. As long as Diamond Bank Plc is currently trying to cope with huge debts and escape regulatory intervention, it is the only way out. Do you want to learn more and find out if this news is true? Keep reading our post and you definitely will.
The talks about a difficult financial situation in Diamond Bank of Nigeria disturb the users of the bank. Three bank’s directors had to resign from their post, and the authorities of the bank explained it with the appearance of personal reasons (what sounds not very credible). Diamond Bank is one of many smaller Nigerian lenders struggling to maintain a regulatory requirement for banks with international operations to have reserves of capital that cover at least 15 percent of outstanding loans. The company’s ratio stood at 16.3 percent at the end of September. Besides, sources say the bank holds negotiations with new investors to recapitalize and settle 2019 bond maturity and moreover the Diamond Bank CEO – Uzoma Dozie, is allegedly expected to quit his position in 2019.
In the article by the local newspaper, The Nation, said yesterday that both financial institutions in Nigeria (Diamond Bank and Access Bank) are not going to merge. It was assumed that Access Bank of Nigeria would obtain the right to merge with Diamond Bank and as it was reported in Business Insider, the deal was expected to be completed in the first quarter of 2019. Both banks in Nigeria have reached an agreement concerning the foregone acquisition.
The talks that the acquisition deal began when the authorities from Diamond Bank started to look for the way out of a difficult situation in their move against possible regulatory intervention. The discussion was said to have been premise on its huge Non Performing Loans (NPLs) portfolio put at over N150billion. After the examining the offer, the authorities of Access Bank accepted the proposition to acquire Diamond Bank.
However, today Business Insider by Pulse has said that Uzoma Uja, Diamond Bank’s Secretary/Legal Adviser, denies discussions with any financial institution at the moment on any form of merger or acquisition.
“The attention of Diamond Bank Plc (“the Bank”) has been drawn to the rumour in the media stating that the Bank is purportedly in discussions with Access Bank Plc to acquire the Bank. We wish to state categorically that the Bank is not in discussions with any financial institution at the moment on any form of merger or acquisition. We trust that the above clarifies the position of the Bank with regards to the rumour on the various media platforms.”
Access Bank also denied the talks about merging with Diamond Bank or its acquisition. Sunday Ekwochi, the Company Secretary, said:
“We wish to notify the Nigerian Stock Exchange and the general public that the bank has not entered into any such discussions with Diamond Bank or any other institution.”
As it can be observed today, that the bank is still open. and talks about acquisition can be considered rumours.