Politics
CAC Announces New Guidelines For Bank Recapitalization And Mergers
CAC Announces New Guidelines For Bank Recapitalization And Mergers....KINDLY READ THE FULL STORY HERE▶
The Corporate Affairs Commission (CAC) has released new guidelines to assist Deposit Money Banks in their ongoing recapitalization efforts. The commission, in a statement posted on its Facebook page on Friday and signed by its management, emphasized that the guidelines are issued under Section 8 (1) (e) of the Companies and Allied Matters Act No. 3 of 2020, and compliance is mandatory…… CONTINUE READING
The guidelines aim to streamline the process for new incorporations, capital increases, mergers, and changes in license authorizations. For new incorporations, applicants must provide an approved name reservation, approval-in-principle from the sector regulator, a completed online incorporation form, and payment of stamp duty and filing fees. A certificate of incorporation will be issued within 24 hours if all requirements are met.
For banks increasing their share capital, whether through private placements, rights issues, or public offers, they must submit a company resolution, return of allotment, statutory declarations by directors, notice of required regulatory approval, an affidavit by a director, and an amended memorandum of association. The commission stressed that the notice of regulatory approval must comply with Section 127 (3), (4) & (5) of CAMA. The CAC will issue a certificate of increase within 24 hours of receiving regulatory approval.
Small and medium banking institutions planning mergers must provide a signed special resolution for the merger, a scheme of merger approved by the Securities and Exchange Commission, a certified court order authorizing an Extraordinary General Meeting, evidence of publication of the court-ordered meeting, and a certified true copy of the court order sanctioning the merger scheme.
For inquiries or complaints regarding these guidelines and applications, the CAC can be contacted via bankrecapitalization@cac.gov.ng or +234 816 920 9551.
This move follows a directive from the Central Bank of Nigeria in March 2024, which mandated banks to increase their capital bases: international banks to N500 billion, national banks to N200 billion, and regional banks to N50 billion. Banks are currently issuing public offers and rights issues to meet these new capital requirements within the stipulated two-year timeframe.
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