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In the wake of Heritage Bank’s license revocation by the Central Bank of Nigeria (CBN), minority shareholders have called for an investigation into the bank’s management and directors.
The CBN announced the immediate revocation of Heritage Bank’s license, citing the bank’s breach of Section 12 (1) of the Banks and Other Financial Institutions Act (BOFIA), 2020. The apex bank stated, “This action has become necessary due to the bank’s breach of Section 12 (1) of BOFIA, 2020. The board and management of the bank have not been able to improve the bank’s financial performance, a situation which constitutes a threat to financial stability. This follows a period during which the CBN engaged with the bank and prescribed various supervisory steps intended to stem the decline. Regrettably, the bank has continued to suffer and has no reasonable prospects of recovery, thereby making the revocation of the license the next necessary step.”
Following this decision, the CBN appointed the Nigeria Deposit Insurance Corporation (NDIC) as the liquidator of Heritage Bank in accordance with Section 12 (2) of BOFIA, 2020.
Speaking with The PUNCH, Boniface Okezie, the National Coordinator of the Progressive Shareholders Association, emphasized the need for a thorough probe. “Probing the bank managers would boost confidence in the sector,” Okezie stated. He also criticized the CBN’s handling of the situation, saying, “CBN is also part of the problem in the system. If the bank had been insolvent over the years and they had been living under the mercy of CBN, which should have taken action. In all this, what is the role of AMCON? They should have taken over the bank after all, the bank was also paying a levy to AMCON. Instead, CBN has directed NDIC to take over for liquidation. Is that the way to go?”
The call for an investigation underscores the broader concerns among shareholders about the regulatory oversight and management practices within Nigeria’s banking sector.
