CBN deducts N5.4bn from Standard Chartered, Citi Bank, Stanbic IBTC Shareholders kick

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By Kayode Tokede

The Central Bank of Nigeria (CBN) has deducted N5.4 billion from  Citi Bank, Standard Chartered and Stanbic IBTC after it fined the four commercial banks N5.87 billion for helping MTN Nigeria to move a total of $8.1 billion abroad with improper certificates.

The commercial banks sanctioned by CBN last week led by Diamond Bank Plc. Diamond Bank as at the time of filing in this report are yet report to the Nigerian Stock Exchange ( NSE) the N0.25 billion deduction by CBN.

Stanbic IBTC in a statement to Nigerian Stock Exchange (NSE) on Thursday said, CBN debited N1.886 billion from the bank’s account. While a source confirmed to Nigerian NewsDirect that CBN deducted N2.4 billion in fines from Standard Chartered and N1.2 billion from Citigroup for allegedly helping MTN move funds abroad.

MTN denied any wrongdoing, while Standard Chartered said it was fully co-operating with the CBN with a view to resolving the issue as soon as possible.

Stanbic IBTC in a statement said it maintained its position on the sanction, stressing that nothing illegal has been committed.

The statement reads, “Following our earlier announcement to The Nigerian Stock Exchange August 30,  2018, in respect of the penalty of N1.886 billion imposed by the Central Bank of Nigeria (CBN) on our banking subsidiary – Stanbic IBTC Bank Plc in relation to the remittance of foreign exchange on the basis of certain capital importation certificates issued to MTN Nigeria Communications Limited, we write to update The NSE that the CBN has debited the account of our banking subsidiary with the CBN for the full amount of the above stated fine advised to the Bank.

“Stanbic IBTC Holdings as well as our banking subsidiary maintain our position on this matter, which is the fact that the Bank has done nothing illegal and accordingly the Bank will continue to provide CBN with documents and details in support of our contention that our actions in relation to these transactions were not illegal.”

The bank maintained that the CBN’s N1.8 billion deduction does not impact on its capacity of doing business

“Please note that this debit does not impact on the capacity of our banking subsidiary to handle clients’ requests or clients’ ability to continue to carry out viable business transactions with either the Bank or any member of the Stanbic IBTC Group, whether in relation to the importation of capital or otherwise. Our business transactions will continue to be handled professionally and in a manner that is aligned with Nigeria’s laws and regulatory guidelines,” a statement signed by Company Secretary, Stanbic IBTC, Mr. Chidi Okezie added.

Amid the statement, Stanbic IBTC shares dropped by N2.00 or 4.26 per cent to N45.00 on Thursday.

The apex bank normally debits the account of commercial banks when it imposes a fine or to implement aspects of its monetary policies such as Cash Reserve Ratio (CRR).

However, the shareholders of Diamond Bank Plc and Stanbic IBTC have expressed disappointment  with the CBN for sanctions imposed on their banks over illegal capital repatriation.

Speaking with Nigerian NewsDirect, shareholders lamented that over regulated banking industry is affecting the sector negatively, stating that the apex regulator need to explain to Nigerians the reasons behind the sanctions.

The president, Progressive shareholders association of Nigeria (PSAN), Mr. Boniface Okezie in a phone chat with our correspondent said CBN should explain reasons behind the sanctions.

He explained that capital repatriation by these commercial banks were approved by CBN and shareholders are interested to know the reasons behind the sanction.

According to him, “can dollar be repatriated with CBN approval? CBN need to explain to Nigerians what transpired in the deal that went wrong.

“Shareholders are concerned with the sanction by the CBN and the blame goes to CBN because the sanctions cannot be justified

“it is very unfortunate that CBN is sanctioning these banks.”

Also commenting, a shareholder, Mr. Taiwo Oderinde, said the banking industry is heavily regulated.

He explained that banks are expected to follow stipulated guild lines guiding their operations daily.

In his words, “I do not expect banks to be perfect. There are too many guild lines banks most obliged to.

“To me as a shareholder, banking industry in Nigeria is over regulated and it is not good for our economy. The sanction is expected to affect diamond bank since the chairman of Diamond bank is the promoter of MTN Nigeria.”

He added that the sanction would definitely affect Stanbic IBTC performance this year.

In his own perspective, the former General Secretary of Independent Shareholders Association of Nigeria (ISAN) Mr. Adebayo Adeleke, said the sanction on two listed banks is worrisome.

He urged the apex bank to rather sanction an individual that committed the crime rather than sanctioning the Organisation.

He said, “When you sanction a company, it affects shareholders funds deposited with the Bank.

“The CBN sanction does not affect  managing director of these banks but shareholders who invested, expecting dividend at the end of the year.

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