Access and Diamond held a call today to discuss their combination and let's just say there are several angry minorities in both camps though one senses more on the Diamond side. Diamond dropped the bomb that they will be taking additional loan write-downs of btw 150-180b
What was strange was the excuse Uzoma put up. He says Diamond began IFRS 9 implementation and found the extra bad eggs just barely a month after filing their 9M 2018 results. If that is indeed the case the 0.3x book Access got could be more expensive once we adjust for the NPL
Uzoma also struggled to handle some of fiery questions which often saw Herbert step in to take some heat off. Basically, Diamond bank's numbers are not a fair representation of the what they've been saying for sometime. Looks much worse now.
Over the last four years Diamond has booked provisions of N200b, no in agreeing to a deal which valued them at a 70% discount of their book value hints at an NPL number higher than the 12% number as at 9M 2018. Basically it calls to question Nigerian bank numbers its just a joke
Anyway two sets of court ordered shareholder votes will be taking place in Q1 2019 as with the 2019 elections. Access will need to convince its shareholders while also asking them for extra money via a planned rights issue. Diamond i suspect has some internal battles to go.
