(Adds quotes, details)
LAGOS, June 28 Nigeria's central bank said on
Monday it was extending to the end of September a deadline for
the recapitalisation of Wema Bank and Unity Bank, two of the
lenders bailed out last year in a $4 billion rescue.
The central bank granted the extension because it had taken
longer than expected to establish the Asset Management Company
of Nigeria (AMCON), a "bad bank" meant to soak up non-performing
loans and help recapitalise the rescued banks.
"Due to the unanticipated three month extension in the
timeline for setting up AMCON, the central bank has granted a
three-month extension for the two banks to recapitalise," the
regulator said in a statement.
"It is our hope that with the progress made so far, the two
banks should be recapitalised by the end of September 2010
through the combination of sale of toxic assets to AMCON and
injection of fresh capital," it said.
The previous deadline for the two banks to recapitalise had
been the end of June.
Wema Bank said a month ago it planned to raise 49 billion
naira ($325 million) through a special placement with foreign
and local investors and was confident it could recapitalise
before the original deadline. [ID:nLDE64O1NH]
Wema swung to a 795 million naira pre-tax profit in the
first quarter from a 2.0 billion naira loss a year earlier.
Unity Bank said last month it had cut its 2009 pre-tax loss
by 1.3 percent on the previous year to 21 billion naira.
Legislation to create AMCON has been passed by parliament
and sent to the president for approval. It aims to buy up bad
bank loans in exchange for government bonds in order to free up
banks' balance sheets and get them lending.
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(Reporting by Randy Fabi; Writing by Nick Tattersall)