How Access Bank got Japaul to pay up N37 billion loan that had gone bad

In 2018 when Access Bank took over Diamond Bank, in what is the largest merger in Nigeria’s banking history, they knew it was not a match made in heaven like their PR agencies will make you believe.

In merging with Diamond Bank and taking over their juicy assets, they had also taken over the lemons that had for years bedeviled the bank who had pioneered mobile banking applications well ahead of its time.

When Access Bank merged with Diamond Bank, the latter had total loans and advances of N787.8 billion out of which N219.9 billion in loans were impaired. Oil and gas-related loans made up a significant chunk of the loans and were estimated at about N302.6 billion, most of them distressed.

Included in the oil and gas loans was a $66.4 million in loans owed to the bank by Japaul Oil and Maritime, as they were referred to at the time. The loans had gone bad accumulating unpaid interest of about $11.2 million. By the time Access Bank took over the loans, Japaul agreed to a restructuring rolling over both the principal and interest.

Comments 11

Abiodun

January 20, 2021 · 8:16 am

I love this story… It was as though I was seeing a 15 min Netflix short movie!!!! Kudos to the writer!!!!

Sanmi Temitope Oladeke

January 20, 2021 · 2:30 pm

Lol

Reply

Abelazuh

January 20, 2021 · 9:10 pm

Good news for access bank and good news for Japaul PLC. It appears most of the mega Companies reply on bank facility to survive. What is happening to the equities they raise from stock market?

Igalarebel

February 3, 2021 · 4:40 pm

Due to lack of strong corporate governance its unfortunately for the founders and early investors to chop. The questions we need to ask are what are the experience of the management team in this new industry, Gold and technology that would prevent them from ending up in the same predicament down the line

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Uzo Gold

January 21, 2021 · 4:45 am

This is a welcome development I wish this can be done to other companies or individuals who collaborate with banks top managements to milk banks dry without collateral or following due process,Leading to bank liquidation.
Thanks to Soludo’s policy that have saved the situations if not a lot of banks could have been erased/liquidated especially during this economic challenges leaving depositors stranded and hopeless.

Buchi

January 24, 2021 · 8:29 am

This is the only way lenders can survive in this country: aggressive recovery. Typical Nigerian borrower don’t like paying back loans and that’s why many banks would rather put their money in government securities rather than lend to business.

David

January 24, 2021 · 6:30 pm

Access means business

Luqman

January 26, 2021 · 2:16 pm

But 2021- 2026 is not 6years. That is 26years!!! Secondly, what will determine the success of the restructure is the available cashflow to service the loan. Let’s hope this is not kicking the can down the road.