Nigeria's central bank (CBN) expects three international lenders, a number of private equity houses and local lenders to submit offers for banks bailed out by the state by mid-July.

The interested parties are undertaking “detailed” due diligence, according to CBN.  Nigeria imposed new management and injected funds into eight banks last year in a bid to revive them and find potential buyers.

The financial crisis left the country’s lenders with toxic assets of about $10 billion, according to estimates by New York-based Eurasia Group a year ago. The central bank fired the top managers of eight of the country’s 24 lenders and gave the industry an injection of 620 billion naira ($4.1 billion) to stem the decline.

'Securing a future for Union Bank, Oceanic, Intercontinental, PHB and Afri is the priority as these banks are the most “systematically important” to Nigeria,' says CBN governor Lamido Sanusi.

CBN is waiting for presidential approval for a law that will create the Asset Management Company of Nigeria, a government entity that will buy bad debts from the banking sector, using funds raised through government-guaranteed local bond issuance. The bonds will be issued on a deal by deal basis.  

Source: Bloomberg