The Central Bank of Nigeria, CBN has confirmed that its has provided a short term loan to Skye Bank PLC to boost the ailing bank’s liquidity.
Skye Bank was taken over by the CBN on the after the bank’s capital adequacy ratio, CAR fell beyond regulatory benchmark.
Speaking on behalf of the CBN to Bloomberg, Isaac Okorafor said the loan is a short term facility to shore up the capital base on the bank and “ensure that some withdrawals it suffered in the wake of the undue panic of last week do not adversely affect its operations,’’.
This however, negates the CBN stance that ‘No Nigerian bank is in distress‘.
The sudden takeover of the bank shocked the already fragile banking system. Customers rushed to withdraw funds, thus further complicating the bank’s going concern as a lender and deposit money bank.
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