Banking
CBN replaces Skye Bank chair, MD, says depositors’ funds safe
ABUJA-THE Central Bank of Nigeria on Monday wielded the big stick by replacing some key members of the Board of Directors and management team of Skye Bank Plc, saying its findings revealed that the bank had fallen short of the minimum thresholds in critical prudential and capital adequacy ratios.
As a result, the chairman, managing director, deputy managing director, all non-executive directors and the two longest-serving executive directors on the board and management team of Skye Bank were replaced by the central bank.
The CBN Governor, Mr. Godwin Emefiele, told a news conference in Lagos on Monday that the “proactive moves have become unavoidable in view of the persistent failure of Skye Bank to meet minimum thresholds in critical prudential and adequacy ratios, which has culminated in the bank’s permanent presence at the CBN lending window.”
Godwin Emefiele, CBN Gov
He said in the overall interest of the bank, its chairman, Olatunde Ayeni; managing director, Timothy Oguntayo; deputy managing director, Mrs. Amaka Onwughalu; and executive directors, Mr. Dotun Adeniyi and Mrs. Ibiye Ekong, had voluntarily resigned their appointments ahead of the CBN action.
The affected non-executive directors are Mr. Victor Odozi, Mr. Babajide Agbabiaka, Dr. Jason Fadeyi, Mr. Kunle Aluko, Mr. Victor Adenigbagbe, Mr. Abdul Bello and Hajiya Amunna Lawan Ali.
In their place, the governor said the CBN had selected industry experts and people of high integrity whom it believed could turn the bank around.
In this regard, Emefiele announced Alhaji Muhammad Ahmad as the new chairman of Skye Bank, while Mr. Adetokunbo Abiru was also named as the new managing director.
According to a statement by Skye Bank, other members of the reconstituted board are Bayo Sanni, Idris Yakubu, Markie Idowu and Abimbola Izu, all of who had been serving as executive directors of the lender before now.
The CBN governor noted that the more recent executive directors in Skye Bank would be allowed to remain to ensure continuity and a smooth transition.
According to him, the new members of the board and management team of Skye Bank have the sole responsibility of ensuring the speedy restoration of the health of the lender.
The CBN helmsman noted that the changes were with immediate effect.
Giving further reasons for its regulatory action on Skye Bank, Emefiele argued that the CBN would be failing in its duties if the situation of the bank was allowed to degenerate before taking such an action.
While maintaining that Skye Bank was not in distress, he noted that neither depositors nor shareholders’ funds had been eroded.
Emefiele said the action was taken to avoid a situation where shareholders or depositors’ funds would be affected.
He urged the general public and customers of the bank to conduct their business with Skye Bank, just like any other bank, saying their deposits were safe and intact.
Giving further details on the health of Skye Bank, Emefiele said, “The most important issues in banks are non-performing loans, capital adequacy ratio and liquidity ratio. What we have since late 2014 to 2016 is that the prudential and adequacy ratio of Skye Bank has been weakening.
“We thought it was not right for us to allow this to continue to the point that it gets irreversible. That is why we took this action to nip it in the bud. It has nothing to do with being in distress. We do not want the liquidity and adequacy ratio of the bank to worsen to the point that depositors’ funds get into risk. The board itself has come to the realisation that they have done their best and it is about the time that they bowed out so that a new team can come in to run the bank in order to improve its position.
“Naturally, what you have seen is that by the time the capital is recomputed and revalued, there is a sort of weakening in value, but it has not eroded the capitalisation and value of the bank. We are hoping that as the new team comes up, the value will definitely improve.”
On whether the CBN would take the same action on other banks demonstrating similar problems, the CBN governor said, “The strategic health of the banking industry remains sound. And where there is a need to inform the general public about the strategic health of a bank, we will do it. I want to assure everybody that the strategic health of the industry is still good.
“No doubt, as a result of the global shock, there is weakening in certain ratios of the banks; but then, those ratios have not weakened to the point where we can say the industry is distressed. We are appealing to all depositors to be calm.
“There is no need to leave an impression that any bank is distressed. We at the CBN and the NDIC have held discussions, and I want to assure you that no deposit is at risk. Customers should continue to do their business the way they have been conducting in all the banks. No depositors will lose their money. SEC and other concerned regulators have been informed of this development.”
Emefiele added, “It is important to reiterate the fact that Skye Bank is not in distress and remains a healthy bank in the system. The CBN hereby assures depositors, shareholders and all relevant stakeholders that there is no reason for concern or panic as we seek their continued cooperation at this time.
“It is our expectation that the shareholders and remaining executive directors will work seamlessly with the new team to ensure that the fortunes of the bank are restored in the shortest time possible.”
Emefiele recalled that the CBN had held several meetings with the management and board of Skye Bank as part of its strategy of close engagement whenever a bank’s financial or governance situation posed potential threats to the overall stability of the financial system.
He said that despite the expectation of relevant regulators, market watchers, financial analysts and interested stakeholders that Skye Bank should be doing much better than it was, the opposite had been the case.
However, anxious customers besieged branches of the bank in different locations across the country to make withdrawals from their accounts, explaining that they were not sure if their money was safe with the lender.
Ahmad, the new chairman of Skye Bank, was the pioneer Director-General and Chief Executive Officer of the National Pension Commission.
He was also a pioneer employee of the Nigeria Deposit Insurance Corporation where he rose to become a director. He has also served on the board of various companies and committees, including banks and not-for-profit organisations.
Abiru, the new MD, is a seasoned accountant and banker, and was until recently an executive director in First Bank Plc. He is also a former Commissioner for Finance in Lagos State from 2011 to 2013.
Meanwhile, the share price of Skye Bank plunged by N0.10 (9.52 per cent) to close at N0.95 from N1.05 as investors dumped their holdings of the shares of the bank as news of the CBN action filtered in on Monday.
The bank was top on the list of 31 firms that recorded losses in their share prices.
These losses resulted in the Nigerian Stock Exchange’s market capitalisation shedding N104bn to close at N9.960tn from N10.064tn.
The new chairman of the bank, Ahmad, was quoted in a statement on Monday as expressing optimism about the lender, given its vast potential and strategic position in the economy.
A renowned economist and the Chief Executive Officer, Financial Derivatives Limited, Mr. Bismarck Rewane, said, “The CBN has intervened by changing the board of the bank, but the ownership remains the same; it is a quoted bank. Now, time will be given to recapitalise the bank and support it so that it is not under pressure.”
Asked what the implications would be for the banking industry, he said, “To be honest with you, not much. It means that banks that are insolvent will need to capitalise within a period. It is early days; let’s just say that the regulator is now beginning to shift emphasis from monetary policy to banks’ systemic stability.
“The new managers are very rounded and solid. I know M. K. Ahmad; he is an excellent man. He worked at the NDIC. He was the head of PenCom. The other man, Mr. Abiru, has been a commissioner and worked in First Bank. Again, I don’t think it will affect the banking system detrimentally.”
The Head of Research and Investment Advisory at SCM Capital Limited, Mr. Sewa Wusu, noted that the CBN had recently said three banks had yet to comply with the capital adequacy ratio and that a period of time was given to them to measure up.
He said, “It has been long we witnessed an action of such a nature. The last time we witnessed that was when the CBN actually took over three banks and coincidentally, one of them, Mainstreet Bank, was acquired by Skye Bank.
PUNCH-
Plans are in top gear for the 11th Annual General Meeting (AGM) of the FBN Holdings Plc.
The management made this disclosure in a notice it filed with the Nigerian Exchange Limited (NGX) on Thursday, where it averred that it has not been served with any court order against the proposed AGM.
According to notice, which was signed by the acting Company Secretary, Adewale Arogundade, FBN Holding said, “The attention of FBN Holdings Plc (the Company) has been drawn to recent media reports purporting that the Company has received a Court Order stopping it from holding the Annual General Meeting (AGM) scheduled for August 15, 2023.
“We confirm that this assertion is a false narrative as the Company has, as at the date hereof, not been served with any court order to stop the forthcoming AGM.
“Suffice to mention that the AGM is a statutory meeting of Shareholders that must be held in accordance with the law, further to which the Company will notify the regulators and the public as appropriate if there is any lawful order to restrain the Company from conducting same.
“We hereby assure our esteemed Shareholders that the AGM shall hold on August 15, 2023, as planned and we look forward to their attendance and active participation at the meeting.”
However, court orders published in national dailies showed that the Federal High Court in Lagos had issued an order against the financial institution, barring it from holding its 11th AGM.
The order was entered pursuant to a petition by Olusegun Onagoruwa, in suit No: FHC/L/CP/1271/2022. It was addressed to the bank and some other bank officials.
It read, “Take notice that unless you obey the directives in the judicial order contained in the order made on July 15, 2022, by the Federal High Court, Lagos, by refraining from proceeding with the 11th Annual General Meeting of FBN Holdings Limited proposed for August 15, 2023, from seeking approval to issue or raise share capital in any manner whatsoever, from appointing or confirming the appointment of new directors, or in any other manner taking any step towards implementing, actualising enforcing resolution of the 10th Annual General Meeting of FBN Holdings Plc held on June 20, 2022, or in any other manner overreaching, disobeying or undermining the said order of a court, you will be guilty of contempt of court and you will be liable to be committed to prison and to there imprisoned.”
Biztellers brought you a report that a segment of shareholders had staged a protest at the headquarters of the bank on Monday, calling for the AGM to be held, as well as soliciting regulatory interventions.
It is expected that at the AGM, FHN Holdings is poised to breathe life into plans to seek shareholders’ approval to raise N150bn fresh capital via a rights issue and elect new directors including billionaire, Femi Otedola and Samson Ariyibi among other resolutions.
The Central Bank of Nigeria (CBN) has refuted claims of devaluing the.
Earlier reports suggested that the CBN had devalued the Naira, lowering its exchange rate from N631 to the dollar, compared to the previous day’s rate of N461.60 at the Importers and Exporters (I&E) window.
However, the Central Bank of Nigeria (CBN) released a statement on Thursday through its Acting Head of Corporate Communications, Dr. Isa Abdulmumin, categorizing the report as false information.
In the statement titled ‘CBN Has Not Devalued The Naira’, he said the attention of the apex bank was drawn to the news report by an Abuja based newspaper edition of June 1, 2023, titled “CB Devalues Naira To 630/51”.
However, the CBN stated categorically that the news report was replete with outright FALSEHOODS and destabilizing innuendos, ‘reflecting potentially willful ignorance of the said medium as to the workings of the Nigerian Foreign Exchange Market.’
“For the avoidance of doubt, the exchange rate at the Investors’ & Exporters (I&E) window traded this morning (June 1, 2023) at N465/USS1 and has been stable around this rate for a while.
“The public is hereby advised to ignore the news report by Daily Trust in its entirety, as it is speculative and calculated at causing panic in the market,” the CBN spokesman added.
He, therefore, advised media practitioners to verify their facts from the Central Bank of Nigeria before publishing in order not to misinform the public.
Biztellers had earlier reported that 139 micro financial institutions, made up of 132 microfinance banks, four primary mortgage banks, and three finance companies fell under the sledgehammer of regulatory authorities with their operating licenses withdrawn.
The Central Bank of Nigeria (CBN) made public the revocation in the official gazette of the Federal Government published on the apex bank’s website on Tuesday.
We now avail you of the names of the affected micro financial institutions, so that you can check if the one you have been doing business with is affected.
Governor, CBN, Godwin Emefiele, explained that the licenses were revoked in the exercise of the powers conferred on the apex bank under Section 12 of BOFIA 2020, Act No. 5.
Biztellers shares below the full list of the affected Microfinance Banks, finance companies and primary mortgage institutions:
S/No. Name Of Institution
1. ATLAS MICROFINANCE BANK
2. BLUEWHALES MICROFINANCE BANK
3. EVEREST MICROFINANCE BANK
4. IGANGAN MICROFINANCE BANK
5. MAINSAIL MICROFINANCE BANK
6. MERIT MICROFINANCE BANK
7. MINNA MICROFINANCE BANK
8. MUSHARAKA MICROFINANCE BANK
9. NOPOV MICROFINANCE BANK
10. OHON MICROFINANCE BANK
11. PREMIUM MICROFINANCE BANK
12. ROYAL MICROFINANCE BANK
13. STATESMAN MICROFINANCE BANK
14. SUISSE MICROFINANCE BANK
15. VIBRANT MICROFINANCE BANK
16. VIRTUE MICROFINANCE BANK
17. ZAMARE MICROFINANCE BANK
18. NORTH CAPITAL MICROFINANCE BANK
19. CHIDERA MICROFINANCE BANK
20. EXCELLENT MICROFINANCE BANK
21. NI’IMA MICROFINANCE BANK
22. COSMOPOLITAN MICROFINANCE BANK
23. PROGRESSIVE LINK MICROFINANCE BANK
24. TRUST ONE (FOMERLY DESMONARCHY)
25. EKUOMBE MICROFINANCE BANK
26. FIRST INDEX MICROFINANCE BANK
27. OLA MICROFINANCE BANK
28. ULI MICROFINANCE BANK
29. VERDANT MICROFINANCE BANK
30. AGULERI MICROFINANCE BANK LIMITED
31. APEKS MICROFINANCE BANK LIMITED
32. FAHIMTA MICROFINANCE BANK LIMITED
33. MANNY MICROFINANCE BANK LIMITED
34. REALITY MICROFINANCE BANK LIMITED
35. SURBPOLITAN MICROFINANCE BANK LIMITED
36. ONYX MICROFINANCE BANK LIMITED
37. OSINA MICROFINANCE BANK LIMITED
38. OLOFIN-OWENA MICROFINANCE BANK LIMITED
39. ZIKADO MICROFINANCE BANK LIMITED
40. PRUDENTIAL CO-OPERATIVE MICROFINANCE BANK LIMITED
41. PENIEL MICROFINANCE BANK LIMITED
42. TARABA MICROFINANCE BANK LIMITED
43. BRASS MICROFINANCE BANK LIMITED
44. MICHIKA MICROFINANCE BANK LIMITED
45. NDIAGU MICROFINANCE BANK LIMITED
46. NORTHBRIDGE MICROFINANCE BANK LIMITED
47. FCT MICROFINANCE BANK LIMITED
48. OMU-ARAN MICROFINANCE BANK LIMITED
49. CHERISH MICROFINANCE BANK LIMITED
50. BIPC MICROFINANCE BANK LIMITED
51. DANELS GLOBAL MICROFINANCE BANK LIMITED
52. BANCORP MICROFINANCE BANK LIMITED
53. MANNA MICROFINANCE BANK LIMITED
54. MONEYWISE MICROFINANCE BANK LIMITED
55. MERCURY MICROFINANCE BANK LIMITED
56. NEW AGE MICROFINANCE BANK LIMITED
57. PEARL MICROFINANCE BANK LIMITED
58. ZAWADI MICROFINANCE BANK LIMITED
59. SEED CAPITAL MICROFINANCE BANK LIMITED
60. EDUEK MICROFINANCE BANK LIMITED
61. EKSU MICROFINANCE BANK LIMITED
62. DAKINGARI MICROFINANCE BANK LIMITED
63. OGOJA MICROFINANCE BANK LIMITED
64. NWABOSI MICROFINANCE BANK LIMITED
65. NUTURE MICROFINANCE BANK LIMITED
66. ACTIVE POINT MICROFINANCE BANK LIMITED
67. AMOYE MICROFINANCE BANK LIMITED
68. BOLUWADURO MICROFINANCE BANK LIMITED
69. IYEDE MICROFINANCE BANK LIMITED
70. MAYFAIR MICROFINANCE BANK LIMITED
71. CALABAR MICROFINANCE BANK LIMITED
72. IGHOMO MICROFINANCE BANK LIMTED
73. HACKMAN MICROFINANCE BANK LIMITED
74. IDESE MICROFINANCE BANK LIMITED
75. BRIDGEWAY MICROFINANCE BANK LIMITED
76. GRASSROOT MICROFINANCE BANK LIMITED
77. SURELIFE MICROFINANCE BANK LIMITED
78. TIJARAH MICROFINANCE BANK LIMITED
79. IC-GLOBAL MICROFINANCE BANK LIMITED
80. EJIAMATU MICROFINANCE BANK LIMITED
81. BRIYTH COVENANT MICROFINANCE BANK LIMITED
82. NANKA MICROFINANCE BANK LIMITED
83. CUB MICROFINANCE BANK LIMITED
84. BFL MICROFINANCE BANK LIMITED
85. UMUNNE MICROFINANCE BANK LIMITED
86. OROKE MICROFINANCE BANK
87. ALKALERI MICROFINANCE BANK LIMITED
88. CROWNED EAGLE MICROFINANCE BANK LIMITED
89. UNIFA MICROFINANCE BANK LIMITED
90. DADINKOWA MICROFINANCE BANK LIMITED
91. IFESOWAPO MICROFINANCE BANK LIMITED
92. OAF MICROFINANCE BANK LIMITED
93. BAMA MICROFINANCE BANK LIMITED
94. NGALA MICROFINANCE BANK LIMITED
95. IWOAMA MICROFINANCE BANK LIMITED
96. KADA MICROFINANCE BANK LIMITED
97. KEFFI MICROFINANCE BANK LIMITED
98. NUT-ENDWELL MICROFINANCE BANK LIMITED
99. FIRST MULTIPLE MICROFINANCE BANK LIMITED
100. SBDC MICROFINANCE BANK LIMITED
101. OROS CAPITAL MICROFINANCE BANK LIMITED
102. OZIZZA MICROFINANCE BANK LIMITED
103. PRIMERA CREDIT MICROFINANCE BANK LIMITED
104. IFEANYICHUKWU MICROFINANCE BANK LIMITED
105. IHIOMA MICROFINANCE BANK LIMITED
106. JOSAD MICROFINANCE BANK LIMITED
107. AKPO MICROFINANCE BANK LIMITED
108. AIYEPE MICROFINANCE BANK LIMITED
109. ABC MICROFINANCE BANK LIMITED
110. STAR MICROFINANCE BANK LIMITED
111. PURPLE MONEY MICROFINANCE BANK LIMITED
112. UTUH MICROFINANCE BANK LIMITED
113. STALLION MICROFINANCE BANK LIMITED
114. KJL MICROFINANCE BANK LIMITED
115. CREDIT AFRIQUE MICROFINANCE BANK LIMITED
116. COWRIES MICROFINANCE BANK LIMITED
117. LAWEBOD MICROFINANCE BANK LIMITED
118. MABINAS MICROFINANCE BANK LIMITED
119. BUSINESS SUPPORT MICROFINANCE BANK LIMITED
120. OGBE-AHIARA MICROFINANCE BANK LIMITED
121. OLOFIN MICROFINANCE BANK LIMITED
122. OBOSI MICROFINANCE BANK LIMITED
123. FIYINFOLU MICROFINANCE BANK LIMITED
124. BISHOPGATE MICROFINANCE BANK LIMITED
125. AWKA MICROFINANCE BANK LIMITED
126. ZIGATE MICROFINANCE BANK LIMITED
127. ESAN MICROFINANCE BANK LIMITED
128. ENUGU-UKWU MICROFINANCE BANK LIMITED
129. ECHO MICROFINANCE BANK LIMITED
130. ALLY MICROFINANCE BANK LIMITED
131. NETWORK MICROFINANCE BANK LIMITED
132. AWGBU MICROFINANCE BANK LIMITED
SCHEDULE II
LIST OF FINANCE COMPANIES LICENCES REVOKED
S/No. Name Of Institution
1. HHL Invest & Trust Limited
2. TFS Finance Limited
3. Treasures & Trust Limited
SCHEDULE III
LIST OF PRIMARY MORTGAGE BANKS LICENCES REVOKED
S/No. Name Of Institution
1. RESORT SAVINGS & LOANS
2. SAFETRUST MORTGAGE BANK
3. ADAMAWA SAVINGS & LOANS
4. KOGI SAVINGS & LOANS
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