on AUGUST 11, 2011 · in NEWS

BY MICHAEL EBOH
LAGOS — The Nigerian Stock Exchange, NSE, in a bid to halt the ongoing dumping of shares and loss of confidence in the capital market, has appealed to investors not to be discouraged by the current crisis rocking the financial landscape. It asked them to keep faith in the ability of the authorities in the market to safeguard their investment.

Meanwhile, the nationalised banks have confirmed the injection of funds for recapitalisation by AMCON.
This came on the heels of a massive dumping of shares on the floors of the NSE, following the nationalisation of three banks by the Central Bank of Nigeria, CBN and the Nigerian Deposit Insurance Corporation, NDIC.

The NSE, according to a statement, yesterday, by its spokesperson, Mr. Wole Tokede, appealed to investors not to be disillusioned by recent happenings in the market, saying the Exchange would not renege in its duty of protecting the interest of investors in the market.

He said the Exchange believed that the actions taken by the CBN, NDIC and AMCON would resolve the banking crisis and help stabilise the Nigerian financial markets in due course.

He blamed the slide in the value of listed equities on the full suspension of the three banks, which led to erosion of the market capitalization by N30 billion and also on the crisis in the international financial landscape and global capital markets.

Banks confirm recapitalisation

The nationalised banks, yesterday, confirmed the injection of funds for recapitalisation by AMCON.
In statement, Mainstreet Bank said it had received N285 billion capital from AMCON.

The statement said: “The injection of N285 billion into the operations of Mainstreet Bank Limited MBL, has put the shareholders’ funds of the bank into positive position. With this, Mainstreet Bank now posts capital adequacy ratio that is well above regulatory requirement of 10 per cent and has become one of the most capitalised banks in the country.”

Enterprise Bank, in another statement, said it had received N111 billion from AMCON and repaid N60 billion bail-out money to CBN.

The statement said, “ Enterprise Bank Limited has been fully recapitalized by the Asset Management Corporation of Nigeria (AMCON) by injecting a total of N111billion into the Bank. Accordingly the bank has fully refunded the N60 billion injected into the bank when the Central Bank of Nigeria (CBN) intervened in the defunct Spring Bank Plc in 2007 and 2009. The balance of the funding is left in the Bank to support business development and other financial requirement.

As a result, the bank now fully enjoys a level-playing field and can compete favourably with any other bank in the banking industry without any disadvantage. The bank is in a position to meet all its obligations.
Customer confidence has equally increased and there has been no run on the bank since the transformation of the bank from Spring Bank to Enterprise Bank Limited.

http://www.vanguardngr.com/2011/08/nationalised-banks-nse-appeals-to-investors-as-shares-dumping-persists/