CBN gives loan to Skye Bank

The Central Bank of Nigeria has provided a loan to Skye Bank Plc to boost its liquidity after the lender breached requirements on capital and lending.

The short-term lending facility will allow new management to “ensure that some withdrawals it suffered in the wake of the undue panic of last week do not adversely affect its operations,’’ the Acting Director, Corporate Communications, CBN, Mr. Isaac Okorafor, said in an emailed response to questions.

He said the CBN had also issued guarantees to the bank’s depositors and creditors as a demonstration of its health.

The central bank replaced top managers of Skye Bank earlier this month after it breached required thresholds for liquidity and non-performing loans.

While the regulator moved to calm markets, saying Skye and the industry remained healthy, the stock plunged to record lows, leading declines among other Nigerian lenders.

The CBN has said it has no plan to sell Skye Bank.

The CBN guarantee will not only enhance Skye Bank’s interbank trading and activities; but will also provide assurance to the other banks to continue to deal with and trade with the bank’s instruments in the interbank market.