Bank ready to clean up balance sheet

A Nigerian bank quoted on the Nigerian Stock Exchange (NSE) has concluded plans to clean up its balance sheet in order to provide shareholders with favourable long term values. A competent source close to the bank (name withheld) told Vanguard that the decision by the Board to clean up its balance sheet may not be unconnected with the decision of the Central Bank of Nigeria (CBN) to establish Asset Management Company (AMC) that would be responsible to manage credit toxic for banks. According to the source,
Shareholders need not to panic when  banks write off their bad debts since the CBN is in support of such exercise as it is spearheading the establishment of AMC. The source revealed that not less than 10 banks are getting prepared to use the AMC window as soon as the apex bank put it in place. According to him “ The cleaned up toxic credits are bound to return into the banks and boost their profits. Capital adequacy is a backbone of any bank’s ability to do write off of their bad debt as it gives a clean start for such organizations



According to him “ The cleaned up toxic credits are bound to return into the banks and boost their profits. Capital adequacy is a backbone of any bank’s ability to do write off of their bad debt as it gives a clean start for such organizations.He further noted that the bank has strong liquidity, transparent management, many branches both in Nigeria and across Africa and operate a good risk management.  Any bank with the aforementioned indices will be able to do what is right for its customers and shareholders when it clean its books in the nearest future. A strong balance sheet will provide the means to take advantage of new opportunities in the economy



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