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NDIC To Probe Directors, Officers Of Revoked 183 MFBs, PMBs

by Royal Ibeh
2 years ago
in Lead-In
Reading Time: 3 mins read
NDIC
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The Nigeria Deposit Insurance Corporation (NDIC) will begin the investigation of the directors and officers of the 183 banks whose licences were revoked earlier this year. 

Managing director of the NDIC, Mr Bello Hassan, said this at a one-day capacity building workshop for law enforcement agencies on Thursday in Lagos.

 He said the law enforcement agencies including the Economic and Financial Crimes Commission (EFCC) and the Nigerian police, among others, would soon be called to investigate sharp practices by the directors of these defunct banks.

 “As you are all aware, the Central Bank of Nigeria recently revoked banking licenses of 183 MicroFinance Banks (MFBs) and Primary Mortgage Banks (PMBs) which may require you to be called upon to investigate some of the directors and officers of these institutions with a view to bring to book those found culpable in the collapse of these institutions,” he said. 

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Hassan, represented by Mr Henry Fomah, Head of Legal Department of NDIC, noted that through collaborative efforts of agencies, 12 prosecution cases were currently on-going at various courts.

 “There are 25 on-going investigation at the Nigeria Financial Intelligence Unit (NFIU), 11 with the EFCC and five concluded investigations with the Federal Ministry of Justice for advice and prosecution,” he said. 

According to him, this indicates that the corporation as well as other government agencies are on the right course through collaboration. 

This, he said, would bring to book errant directors, officers, managers of these banks that led to their collapse adding that a stable financial system could not be guaranteed if the banking industry was not well sanitised. 

“The corporation, whilst bearing in mind the positive impact of such collaboration will continue to strive at enhancing the synergy between all of us in the areas of law enforcement relating to investigation and prosecution of financial malpractices. 

“I want to use this forum to appeal to the members of the task force not to relent on your oars but to execute the given mandate diligently thereby achieving the objectives of establishing the task force,’’ he said. 

He added that the corporation was not unaware of the challenges of investigating and prosecuting financial malpractices and bank fraud cases urging officers not to relent in their efforts.

 The NDIC boss noted that the advancements in information technology with new possibilities in banking operations had equally exposed the banking subsector to emerging threats.

 He said the situation had increased the burden on the regulators and supervisors to enhance their operational capacities as well as heightened the need for more collaboration between agencies involved in the fight against banking malpractices. 

“This workshop is, therefore, among the steps taken to provide a platform for the agencies concerned to sharpen their skills, share ideas and be well-equipped to face the challenges. 

“We recognise that, for the corporation to achieve its mandate and objectives in a more efficient and effective manner; and for the banking system to thrive on the gains of a stable financial system; we must all rise up to the challenge of bringing to book those who might have contributed to the failure of their banks,’’ Hassan added. 

Head of legal services at CBN, Mr Kofo Salam-Alada, said it was essential for agencies that would collaborate with regulators to have deep insight into how regulators operate. 

“A lot of gaps have been seen which is why we must commend the Nigerian Deposit Insurance Corporation for having been the vanguard of sponsoring capacity building exercises for the past 12 years,” Salam-Alada said.

The aim of the workshop is to equip officers involved in the investigation and suspicion of financial malpractices in the banking system with necessary skills required to carry out their duties diligently, with particular focus on failed banks. 

The workshop will also enhance their skills and knowledge as law enforcement officers and/or staff of agencies involved one way or the other in the investigation of banking malpractices with special emphasis on distressed banks.

 

Tags: NDICPMBsRevoked 183 MFBs
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Lead-In

Providus Bank has acquired the 34% equity stake held by the Asset Management Corporation of Nigeria (AMCON) in Unity Bank Plc, marking a decisive step toward the long-anticipated merger between the two financial institutions. The deal, valued at about N6.5 billion, saw AMCON offload its decade-old holding in Unity Bank to Providus at a price of N3.18 per share, representing a 110per cent premium to the bank’s prevailing market value of N1.50 on the Nigerian Exchange. Industry analysts said the transaction signals a turning point for Unity Bank, which has faced prolonged struggles with weak capitalisation, rising non-performing loans, and declining market relevance. By transferring AMCON’s strategic stake, they noted, Providus has strengthened its hand as it pushes for regulatory approvals to consummate a full merger. AMCON acquired its Unity Bank stake during the 2011–2012 banking sector clean-up after the global financial crisis exposed balance sheet vulnerabilities across second-tier lenders. Its divestment, according to banking sources, underscores the corporation’s gradual exit from long-held equity positions as it focuses on recovering toxic assets and reducing its systemic footprint. “AMCON’s sale to Providus is significant not just for Unity Bank but for the entire financial system,” said a Lagos-based investment banker. “It shows the government is serious about cleaning up legacy interventions while paving the way for stronger private-sector-led banks.” Unity Bank shareholders are set to benefit from the deal’s pricing structure. At N3.18 per share, Providus’ offer more than doubles the bank’s trading value, giving investors a rare premium exit in a market where bank stocks often trade at steep discounts. For minority shareholders, the merger if approvedcould also unlock value by combining Providus’ niche strength in corporate banking and digital services with Unity Bank’s broader retail and SME base. Providus, one of Nigeria’s fastest-growing mid-tier lenders, is widely seen as using the Unity Bank deal to accelerate its ambition of achieving national bank status. By absorbing Unity’s branch network and customer base, the lender would scale its operations beyond its current limited licence, positioning itself to compete more aggressively with tier-one institutions. “The synergies are clear,” said a senior Unity Bank executive familiar with the talks. “Providus brings balance sheet strength and digital innovation, while Unity offers reach and brand equity, especially in northern Nigeria.” Following AMCON’s divestment, the proposed merger will be subject to approval from the Central Bank of Nigeria (CBN), the Securities and Exchange Commission (SEC), and Unity Bank shareholders. Both banks are expected to present a detailed merger scheme in the coming months, outlining share swap ratios, post-merger governance, and capital plans. Market watchers say regulatory scrutiny will focus on whether the combined entity meets CBN’s revised recapitalisation thresholds, which mandate higher minimum capital bases for Nigerian banks. The Providus–Unity transaction comes amid a wave of consolidation moves triggered by the CBN’s ongoing recapitalisation drive. Several lenders are exploring mergers, acquisitions, or fresh capital injections to meet compliance deadlines ahead of 2026. “This is the first big-ticket transaction of the recapitalisation era,” said a financial markets analyst. “It won’t be the last.”

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