Access Bank takes impairment on 9mobile loan

Access Bank said yesterday it has booked a N4 billion ($13 million) impairment on its loan to troubled telecoms firm 9mobile, formerly known as Etisalat Nigeria.

Access Chief Executive Herbert Wigwe said the bank had a direct exposure of N11 billion to 9mobile, as well as an exposure of N35-39 billion to the telecoms firm’s suppliers.

Wigwe told an analysts’ call that Access hoped to recover the debt once 9mobile was sold to new investors.

Nigerian banks have agreed an extension to a $1.2 billion loan made to 9mobile, pending the mobile operator finding new investors. However, some lenders outside the syndicated facility are making provisions.

“We have downgraded the risk of Etisalat and have taken increased collective impairments,” he said.

Access Bank said non-performing loans rose to 2.5 percent by the half-year from 2.1 percent as at December, though it posted an 18.4 percent rise in half-year pretax profit to N52.08 billion last week.

Regulators stepped in last month to save Etisalat Nigeria from collapse and prevent lenders placing it in receivership, prompting a board, management and name change.

Wigwe said 9mobile has received significant interest from local and international investors after lenders appointed advisers to find new investors. It expected a sale to close within six months.

Access shares, which have gained 70.4 percent so far this year, dipped 3.9 percent to N9.59 on Wednesday.