Keystone Bank, Mainstreet Bank and Enterprise Bank, the three banks owned 100 percent by the Asset Management Corporation of Nigeria (AMCON) made a cumulative loss of N21.82 billion in 2011.

AMCON took over the banks from the Nigeria Deposit Insurance Corporation (NDIC) after the Central Bank of Nigeria (CBN) revoked their licences when they were unable to meet the recapitalisation deadline set by the apex bank in September 2011.

Mainstreet Bank accounted for the highest loss after tax of N12.85 billion, while Keystone Bank made a loss of N7.33 billion. Enterprise Bank made the least loss of N1.65 billion, figures from the 2011 AMCON report show.

All three banks however now have a positive capital position. Mainstreet Bank has the highest capital of N41.62 billion, Keystone bank N27.65 billion and Enterprise Bank N28.15 billion. The assets position of the banks also shows that Keystone Bank has the highest total assets of N367 billion, Mainstreet Bank with total assets of N349 billion and Enterprise Bank with total assets of N215 billion.

The figures also show that the three banks all closed 2011 with positive cash flow.

AMCON had invested a total of N861 billion to recapitalise the three banks in 2011, figures from the AMCON annual report show. The figures show that AMCON recapitalised Mainstreet Bank with N426 billion, Keystone Bank with N301 billion and Enterprise Bank with N135 billion.

The AMCON 2011 annual report also shows that it had two other subsidiaries besides the three banks. The other banking subsidiary was Union Bank Plc where it had invested N383 billion to acquire 58.97 percent of the bank. AMCON states that it has since sold down its stakes in the bank. AMCON had also gone ahead to acquire 95% stake in Ascot Offshore Nigeria Limited for N17.5 billion by taking over the company’s loan book and converting it to equity.

AMCON puts the value of its total investments in the five subsidiaries at N1.26 trillion, as at the end of 2011. At close of the financial year however, AMCON wrote off N1.04 trillion, representing 82 percent of these investments as lost.

AMCON in August this year appointed financial advisers to advise it on what to do with the three banks. The two advisers are Citibank consortium and Renaissance Capital consortium and they have been given a mandate to appraise the value of three banks before considering whether to sell them or list them on the floor of the Nigerian Stock Exchange (NSE).

Citibank is to appraise the value of Mainstreet Bank and advice AMCON on the sale, whilst Renaissance Capital is also responsible for valuation of Keystone Bank and Enterprise Bank. The advisers were given 90 to 180 days to complete their task. This means they are expected to submit their valuation report and advice to AMCON by February 2013 latest.

AMCON had told the media in 2011 that 20 different financial institutions and private equity firms have expressed interest in acquiring the three banks. Recently, First Rand Merchant Bank, which acquired a Merchant Banking licence, said it would be interested in acquiring one of the three banks if they are put up for sale.

Chike Obi, the managing director of AMCON had promised the media that any decision on the sale of the three banks would be done in a transparent and fair manner. He also assured that it would be done in such a way that AMCON would get the best returns on its investments.



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