Wednesday, 5 December 2018

CBN gives Approval for Diamond Bank to Operate only as National Bank

The Central Bank of Nigeria has given approval to Diamond bank to operate as a national bank. The approval was granted on 30th of November, 2018 and was made available by the bank on 4th of December. Diamond bank is facing a non performing loan crisis which may affect investors' fund if reactive actions is not taken.

The approval will enables the bank dispose off its branches in the international scene. According to the press release, Diamond bank is already at the final stage to sale of its United Kingdom subsidiary and in 2017 had sold its West Africa subsidiary. It is likely that the proceed from the sales will be used to set-off the non-performing loan challenges.

Though, Diamond bank will not operate branches at the international scene, it does not stop the bank from offering services to international clients. Also, the bank can use its digital channels such as International banking and Diamond Mobile to provide services to customers in the international market and work with the network of correspondence banks.

Maintaining a national status will give Diamond bank the opportunity to lower the minimum capital requirement of the CBN and improves stronger its business in the local scene. Customers should also not that the approval do not affect their deposit and therefore, there is no need to panicked. Diamond bank shares went up the 0.07 to 0.78 Naira per share and its market capitalization is 18 Billion Naira.

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