**Title: Central Bank of Nigeria Dissolves Boards and Management of Union Bank, Keystone Bank, and Polaris Bank**
The Central Bank of Nigeria (CBN) has taken decisive action by officially dissolving the Board and Management of Union Bank, Keystone Bank, and Polaris Bank, as per a press release dated January 10, 2024. This measure is a direct response to the banks’ non-compliance with critical regulatory provisions outlined in Section 12(c), (f), (g), (h) of the Banks and Other Financial Institutions Act, 2020, encompassing a range of regulatory and governance expectations.
The CBN, in citing the rationale behind this decision, identified concerns such as regulatory non-compliance, failures in corporate governance, and engagement in activities posing a threat to financial stability. Mrs. Sidi Ali Hakama, the Acting Director of Corporate Communications at the CBN, stated, “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.”
The central bank, in line with its mandate to ensure a safe, sound, and resilient banking environment, emphasized its commitment to upholding the safety and security of depositor funds. Mrs. Sidi Ali Hakama reiterated the CBN’s dedication to protecting the financial system within the country.
In a related context, last December, Titan Trust Bank’s chairman, Babatunde Lemo, was questioned by Special CBN Investigator Jim Obazee regarding Titan Trust Bank’s acquisition of Union Bank of Nigeria Plc. Allegations in the investigator’s report suggested the use of proxies by a former CBN Governor, Godwin Emefiele, in setting up Titan Trust Bank and acquiring Union Bank. Titan Trust Bank, however, issued a press release denying any wrongdoing.
Regarding Polaris Bank, controversy arose in 2022 over claims that a higher purchase offer had been made during the bank’s sale compared to the offer accepted by the central bank. The CBN refuted these claims, asserting that the divestment from Polaris Bank was supervised by a Divestment Committee comprising senior representatives of AMCON & CBN, supported by reputable legal and financial advisers.
In the broader context, the current leadership of the central bank, headed by Yemi Cardoso, has stated its investigation into alleged wrongdoings during the tenure of former CBN Governor Godwin Emefiele. A leaked report by the Special Investigation on the Central Bank of Nigeria and other entities has alleged financial and legal irregularities within the CBN under the leadership of Godwin Emefiele.
