(L-R) Reginald Ihejiahi, MD/CEO, Fidelity Bank Plc and President Goodluck Jonathan at last week's commissioning of GZI can manufacturing plant financed by the bank at Agbara, Ogun State.

SHAREHOLDERS under various shareholder groups have opposed the sale of the bailed-out banks to any local banks, BusinessWorld can authoritatively report.
BusinessWorld investigations have revealed that after repeated consultation on the way forward for the rescued banks, the shareholders passed a vote of no confidence on the local banks indicating that some of them that have expressed interest in buying the bailed-out banks are struggling and weak and, therefore, cannot recapitalize another bank. They also said that allowing any of the local banks to buy any of the rescued banks may result in assets-stripping of the acquired banks.
The shareholder-groups made their position known at a meeting between them and the management of FinBank Plc at the Eko Hotel & Suites, Lagos last Thursday. The meeting which was at the instance of the management of FinBank Plc, is the second of formal meetings planned by various management of the rescued banks with their shareholders to chart the way forward with respect to the recapitalization of the banks. Oceanic Bank International Plc was the first to engage its shareholders in a formal meeting to agree on the recapitalization of the bank. The other banks are to hold similar meeting with their shareholders in the weeks ahead.
A representative of one of the shareholder groups told BusinessWorld that the shareholders spoke with one voice on the sale of the banks at their meeting with the management of FinBank. He said that the shareholders strongly opposed the idea of allowing the local banks to buy into any of the rescued banks. He also said that the shareholders took the position that they must be primarily involved in the discussions with any investors or groups of investors that have shown interest in buying into the rescued banks. According to him, the shareholders are not opposed to bringing new investors. Their position, he said, is that they must be involved in the selection of the investors.
The current position of the shareholders on the recapitalization issue seems to have been in contrast with the position of the apex bank which has not made any distinction on the issue of whether it is local or foreign banks that should be allowed to recapitalize the banks. The apex bank had called for expression of interest in the banks without excluding the local banks from the bid. There are also strong indications that about 90 per cent of the interests so far expressed came from the local banks.
Shareholders’ position is believed to have been informed by the fact that most of the branches of the banks that were acquired under the purchase and assumption programme of the CBN are still lying idle even as some of their assets have been stripped.