Heritage Bank: Shareholders push for MD, EDs’ probe
Some minority shareholders have requested for an investigation of the management and board of the collapsed Heritage Bank.The call was made during a chat with The NigerianWatch following the Central Bank of Nigeria's revocation of the bank's license.
The CBN announced the license revocation with immediate effect, stating, "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 been unable to improve the bank's financial performance, posing a threat to financial stability.
"This comes after a period in which the CBN worked with the bank and imposed different supervisory measures to arrest 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.”
The apex bank then appointed the Nigeria Deposit Insurance Corporation as Heritage Bank's liquidator in accordance with Section 12(2) of the BOFIA, 2020.
Boniface Okezie, the National Coordinator of the Progressive Shareholders Association, told The NigerianWatch that investigating bank managers will boost confidence in the industry.
He stated, "CBN is also part of the problem in the system; if the bank had been bankrupt throughout the years and they had been living at the mercy of CBN, the CBN should have taken action. In all of this, what role does AMCON play? They should have taken over the bank, as it was also paying a charge to AMCON. Instead, the CBN has asked NDIC to take up liquidation. Is that the way?
Boniface Okezie, the National Coordinator of the Progressive Shareholders Association, told The NigerianWatch that investigating bank managers will boost confidence in the industry.
He stated, "CBN is also part of the problem in the system; if the bank had been bankrupt throughout the years and they had been living at the mercy of CBN, the CBN should have taken action. In all of this, what role does AMCON play? They should have taken over the bank, as it was also paying a charge to AMCON. Instead, the CBN has asked NDIC to take up liquidation. Is that the way?
Someone has N20 million in the bank, and you give them N5 million until the bank's assets are examined and liquidated. That's wrong. It will discourage individuals from using banks.
"Besides, is only Heritage Bank insolvent? What happens to some other banks in the sector? Are they powerful and viable? They should inform us. Management should be called in for questioning. Those who ran the bank aground should face questioning. It is not enough for NDIC to liquidate."
"Besides, is only Heritage Bank insolvent? What happens to some other banks in the sector? Are they powerful and viable? They should inform us. Management should be called in for questioning. Those who ran the bank aground should face questioning. It is not enough for NDIC to liquidate."
According to Okezie, in other countries, managers and directors would be held accountable.
"There must be an investigation to retrieve people's funds. What assets does the bank own? CBN should investigate the bank's collapse so that others can learn. This is not good enough; something must be done to stop the situation," he said.
Moses Igbrude, the National Coordinator of the Independent Shareholders Association of Nigeria, also urged that the bank's management should be investigated. They should not ignore it because it will happen again if people are not held accountable. Allow them to study exactly what happened so that they can learn from it and prevent it from happening again."
He added that the decision of the regulator was in line with its legal mandate but expressed concerns at the time it took to arrive at the decision.
“The CBN is the regulator, empowered by law to supervise, to know which bank is healthy and which is not, so they are just doing their job. However, why did it take so long to do what is necessary?
"There must be an investigation to retrieve people's funds. What assets does the bank own? CBN should investigate the bank's collapse so that others can learn. This is not good enough; something must be done to stop the situation," he said.
Moses Igbrude, the National Coordinator of the Independent Shareholders Association of Nigeria, also urged that the bank's management should be investigated. They should not ignore it because it will happen again if people are not held accountable. Allow them to study exactly what happened so that they can learn from it and prevent it from happening again."
He added that the decision of the regulator was in line with its legal mandate but expressed concerns at the time it took to arrive at the decision.
“The CBN is the regulator, empowered by law to supervise, to know which bank is healthy and which is not, so they are just doing their job. However, why did it take so long to do what is necessary?
They also had the option of rescuing the bank, removing the management, and putting in place a CBN-led administration to ensure it remained viable and no one lost anything. At the end of the day, they sell to Nigerians. This option would keep the personnel.
It was a choice, but they chose to revoke the license," he explained.
He went to ask, "What happened?" Were those in authority failing to manage the situation effectively? Did they make loans that went bad? CBN did not tell us. In this situation, I would have favored the solution I proposed. That manner, the signal would not be as severe as people are currently assuming.
It was a choice, but they chose to revoke the license," he explained.
He went to ask, "What happened?" Were those in authority failing to manage the situation effectively? Did they make loans that went bad? CBN did not tell us. In this situation, I would have favored the solution I proposed. That manner, the signal would not be as severe as people are currently assuming.
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