THE Securities and Exchange Commission (SEC) yesterday endorsed the full suspension placed on the shares of five banks declared technically insolvent by the Central Bank of Nigeria (CBN).

The banks are Afribank Plc, Finbank Plc, Intercontinental Plc, Oceanic Bank Plc and Union Bank Plc.

SEC said that "the action taken by the CBN will strengthen the affected banks, the financial sector and invariably benefit shareholders of the banks".

The statement signed by the Head of Media of SEC, Mr Lanre Oloyi, said that the suspension would afford the newly appointed management time to settle down and plan for the rebound of the banks.

According to SEC, the new management of the banks will brief the market on the state of affairs of the banks in the second week of the suspension order.

By the full suspension order, the shares of the banks would not be traded for a particular period determined by the NSE.

The Director-General of NSE, Prof. Ndi Okereke-Onyiuke had said after an emergency meeting with Chief Executive Officers of stockbroking firms, that the suspension was to protect investors' interest.

According to her, the full suspension which will be from August 17 to August 28 has the backing of all regulatory authorities, owners of stockbroking firms and the Institute of Chartered Stockbrokers (ICS).

She said that CBN, NSE and SEC would converge before or after two weeks to review the suspension and decide whether to replace it with technical suspension or remove it totally.

The Guardian Newspaper, Wednesday August 19, 2009