There are media reports that Access Bank Plc, a tier one lender in Nigeria has acquired Diamond Bank Plc.
Diamond Bank Plc has is a mid-sized Nigerian lender that has been in the eye of the storm in the last few weeks after its capital adequacy ratio went below regulatory requirements.
According to the Central Bank, an international bank must have a minimum of 15% as its capital adequacy ratio (CAR). It is a statutory requirements that the CBN demands of lenders to ensure their depositors funds are not eroded by a bank’s loan book.
As a result of the pressure on the bank, Diamond Bank had announced three weeks ago that it has downgraded its operations by applying for a national banking license, an operation scope that requires a 10% CAR requirement.
The acquisition of the bank by Access Bank has been attributed to the loan taken by Diamond Bank’s current Chairman, Pascal Dozie when he bought out Actis when the latter opted to sell off its stake. The inability of Diamond Bank to repay the loan has been attributed to the takeover of the bank to ensure its credit to the mid-sized lender is not jeopardized.
The latest news that Access Bank has acquired Diamond would further bloat the size of the former.