Nigeria’s second-tier lender, Diamond Bank has denied reports that it is in talks with Access Bank in a bid to sell itself to the latter.
There were unconfirmed reports that Access Bank was in talks to acquire the midsized lender after it could not raise funds to shore up its capital adequacy ration within regulatory limits.
Access Bank has not commented on the matter.
Bloomberg reported a few days ago that Diamond Bank Plc has received an offer from a major investor to inject cash by increasing its stake, a move that would help the Nigerian lender keep its capital adequacy ratio above the required threshold, according to the outgoing chairman.
Bloomberg claimed in the report that the proposal was on condition that Chief Executive Officer Uzoma Dozie resigns, Seyi Bickersteth said in an interview in Lagos, the commercial capital, without naming the shareholder. Diamond’s biggest investor is U.S. private equity firm Carlyle Group LP, which declined to comment.
The bank has since refused to comment on the matter.
Last week, global credit rating agency, S&P Global Ratings said it has lowered its long- and short-term issuer credit ratings on Nigeria-based Diamond Bank Plc. to ‘CCC+/C’ from ‘B-/B’.
S&P said it also gave a negative outlook to the bank’s credit rating.
In addition, the rating agency said it also lowered its long- and short-term Nigeria national scale ratings on the bank to ‘ngBB-/ngB’ from ‘ngBBB-/ngA-3.
Diamond Bank is a second tier lender in Africa’s largest economy that is struggling to get its capital adequacy levels within regulatory limits.
Diamond Bank has it rough since 2014, the same year that Uzoma Dozie took over from Alex Otti. That same year, the bank reported a massive cut in its profit.
Last year, signs of stress and diminishing fortunes for the bank looked more glaring when Diamond Bank disclose that it made a loss before tax totaling N11.55 billion for the full year period of 2017.
