9mobile’s largest lender Zenith Bank has made a provision on 30 percent of its loan to the fourth-largest telecommunication firm in Nigeria.
“We have taken about 30 percent … as a provision which we believe is very prudent as the company is undergoing restructuring” Zenith Bank’s Chief Executive Officer Peter Amangbo was quoted as saying by Reuters.
The decision by the bank was to prepare for a new investor. 9mobile was formerly known as Etisalat Nigeria.
The telecom firm had taken out a whopping $1.2 billion loan four years ago from a consortium of Nigerian banks but was unable to repay it due to a currency crisis and a recession in Nigeria.
Other banks that participated in 9Mobile’s loan deal are GTBank, Stanbic IBTC Bank, First Bank, UBA, Access Bank, Ecobank, First City Monument Bank, Fidelity Bank, and Union Bank.
Nigerian regulators stepped in last month to save Etisalat Nigeria from collapse and prevent lenders from placing it into receivership, prompting a board, management and name change.
Zenith Bank is the second-biggest lender by market capitalization. The bank posted a profit after of N75.32 billion for the first half ended June 30, 2017, 112 per cent increase from the profit recorded in the corresponding quarter of 2016.