Shares in Nigeria’s Skye Bank sank to a three-month low on Friday, as investors continued to sell after the central bank replaced Skye’s top executives this week.
Skye Bank shed 8.4 percent on its second day of trading after the central bank’s intervention on Monday. The regulator replaced Skye’s bosses after it failed to meet capital requirements.
Skye shares fell 9.7 percent on Monday, before the stock market closed for three days for a holiday. The shares are down 40 percent this year, to levels last seen in April.
Nigeria’s eighth biggest bank, Skye grew to systemically important size after it acquired Mainstreet Bank in 2014.
Its new chief executive, Tokunbo Abiru, said on Friday that his team will focus on improving the bank’s capital ratios in line with industry standards. He told stockbrokers he would use a recapitalisation and an increase in liquidity levels, without providing details.
Fears over Skye’s capital problems has spread to other banks, analysts say, leading the bank index to fall 1.56 percent on Friday. Two banks led declines on the stock market overall – Diamond Bank, which shed 9.7 percent, and FCMB Group, which lost 8.9 percent.
Earlier, the central bank’s director of banking supervision, Tokunbo Martins, said “one or two” other lenders had also failed liquidity tests, but they were not in the same situation as Skye. The central bank was working with them to restore their ratios, she said.
Nigeria’s central bank has authority to remove bank executives, which it used during the 2008-2009 global financial crisis, when it sacked nine chief executives at under-capitalised banks.