United Bank for Africa (UBA) in a statement on Tuesday, said it had made provisions on loans to 9mobile, the mobile operator formerly known as Etisalat Nigeria.
The bank did not give details of the provision but said it had a N38 billion ($125 million) exposure to 9mobile. UBA said the exposure was secured.
It should also be recalled that Zenith bank had earlier this month made a 30% provision on 9mobile loan.
Banks involved in the loan deal to 9Mobile include Zenith Bank, GTBank, FirstBank, UBA, Fidelity Bank, Access Bank, Ecobank, FCMB, Stanbic IBTC Bank and Union Bank, among others.
A breakdown of the amounts owed the banks showed that the telecoms firm owes UBA $125 million and N38 billion; FirstBank – $79 million and N24 billion; Fidelity Bank – $56 million and N17 billion; Stanbic IBTC – $25 million and N7.5 billion; FCMB – $15 million and N4.5 billion; and Ecobank – $10 million and N3.1 billion.
Also, it showed that Zenith Bank has the highest exposure to 9Mobile amounting to $262 million and N80 billion, GTBank has the second highest exposure of $138 million and N42 billion, Access Bank follows with $131 million and N40 billion.
Nigerian regulators had stepped into the debt crisis to save the teleco, from collapse and prevent lenders from placing the country’s fourth biggest network operator into receivership, prompting a board, management and name change.
Etisalat (now 9mobile) had taken a $1.2 billion loan from a consortium of 13 banks in 2013, but struggled to repay the loan, citing the economic downturn of 2015-2016 and Naira devaluation, which negatively impacted on the dollar-denominated component of the loan.
UBA’s Q2 2017 results which were published recently showed that Profit Before Tax (PBT) grew by a 92% year-on-year (y-o-y). The marked growth in PBT was attributed to strong double-digit (36% y-o-y) growth in pre-provision profits.