The Central Bank of Nigeria (CBN) has dissolved the Board and Management of Union Bank, Keystone Bank, and Polaris Bank.
This action became necessary due to the non-compliance of these banks and their respective boards with the provisions of Section 12(c), (f), (g), (h) of Banks and Other Financial Institutions Act, 2020.
The apex bank said the three banks were not meeting up with their license obligations, are threatening the stability of the financial system and are undercapitalised.
BOFIA Act, 2020 Section 12, states-(1) “Notwithstanding the provisions of this Act or any other law, the Governor may, with the approval of the Board and by notice published in the Federal Government Gazette, or print and electronic media, revoke any licence granted under this Act if a bank—
“(c) fails to fulfil or comply with any condition subject to which the licence was granted; (f) is involved in a situation, circumstance, action or inaction which constitutes a threat to financial stability; (g) fails to comply with any obligation imposed upon it by or under this Act, or the Central Bank of Nigeria Act or any other rule, regulation, guideline or directive made hereunder ; (h) is, in the opinion of the Bank critically undercapitalised with a capital adequacy ratio below the prudential minimum or such other ratio as the Bank may prescribe”.
In a statement, Acting Director, Corporate Communications at CBN, Sidi Ali, Hakama (Mrs.) said the bank’s infractions vary from regulatory non-compliance, corporate governance failure, disregarding the conditions under which their licenses were granted, and involvement in activities that pose a threat to financial stability, among others.
