The Central Bank of Nigeria (CBN) sacked the board of directors of Union, Keystone, and Polaris Banks yesterday, citing infractions ranging from corporate governance failure to involvement in activities that pose a threat to financial stability.
The dissolution of the boards of the affected banks is part of the implementation of the report of the Special Investigator on the Central Bank of Nigeria (CBN) and Related Entities, Jim Obazee, by President Bola Tinubu.
Here is the timeline of events that ultimately led to the CBN’s latest action.
Oct 25, 2021 – Titan Bank sends a request to CBN asking for approval to buy Union Bank
Before the dismissal, the journey began formally on October 25, 2021, with a request from Titan Bank to the Central Bank to acquire Union Bank which was established in 1917 and became known as Barclays Bank in 1925.
In that letter requesting the approval to purchase Union Bank, Titan said the acquisition would be completed in four stages beginning with the acquisition of 91.5%n of the issued shares. This will then be followed by a mandatory tender offer, MTO for the remaining shares and then a buy-out of any shares that are not voluntarily sold on the MTO and finally the merger of Titan and Union Bank with Union Bank as the surviving entity.
Titan then disclosed that the transaction will be funded via a combination of debt and equity with the former coming by way of a $300m facility from Afexim bank and another $175m in equity from two existing shareholders of Titan Bank, Messrs Luxis International DMCC and Magna International DMCC.
March 3, 2022 – CBN responds giving a no objection to the request
On March 3, 2022, the Central Bank wrote to Titan offering a ‘no objection’, practically clearing the way for Titan to begin the humongous acquisition.
June 3, 2022 – Titan informs CBN of settling Union Bank shareholders
On June 3, 2022, Titan Bank wrote to the Central Bank to inform the apex bank that three days earlier, it paid off the selling shareholders of Union Bank.
Oct 14, 2022 – Titan Bank requests approval of CBN for Mandatory Take Over (MTO)
Documents seen by our reporter showed that on October 14, 2022, Titan Bank wrote another letter to the Central Bank asking to be allowed to launch a mandatory take-over of Union Bank.
Oct 24, 2022 – CBN grants Titan Bank approval to launch MTO
The apex bank granted the request via a formal communication on October 24, ten days after the request for an MTO was received.
Nov 2, 2022 – Titan launches mandatory takeover of Union Bank
On November 2, 2022, Titan Bank launched the mandatory takeover of Union Bank on the back of CBN approval. The special investigator said the physical addresses in Dubai claimed by the key investors in Titan Bank, Messrs Luxis International DMCC and Magna International DMCC, could not be located after visits by officials from the Nigerian embassy in the UAE.
Dec 5, 2023 – Botched meeting between Directors of Titan and Union Bank and CBN deputy governor
On December 5, a meeting called between the directors of Union Bank, Titan Bank, and the deputy governor of the CBN in charge of financial system stability did not hold and had to be postponed. The meeting was never held.
Dec 23, 2023 – CBN investigator says FG should seize Union Bank, Keystone, and Titan Trust Bank
Former Central Bank Governor Godwin Emefiele was linked by the bank’s special investigator to the mysterious acquisition of both Union Bank and Keystone Bank which were recommended for nationalisation by the government.
On Keystone Bank, the investigator said in the report, “When we carried out an investigation, we discovered that some persons were used as proxies with the connivance and assistance of Mr Godwin Emefiele and the CBN to acquire Keystone Bank without evidence of payment.”
January 10, 2024 – CBN dismisses directors of Union, Keystone and Polaris banks
The CBN said that the banks’ infractions vary from regulatory non-compliance to corporate governance failure, disregarding the conditions under which their licences were granted, and involvement in activities that pose a threat to financial stability, among others.
It further stated that the action was necessary due to the non-compliance of these banks and their respective boards with the provisions of Section 12(c), (f), (g), and (h) of the Banks and Other Financial Institutions Act, 2020.
These state that the CBN may revoke the licence of any bank if the bank fails to fulfil or comply with any condition to which the licence was granted or if the bank is involved in a situation that is a threat to financial stability.
The licence can also be revoked if the bank fails to comply with any condition under the Bank Act or any directive, rule or regulation made; and if, in the opinion of the CBN, the bank is undercapitalized with a capital adequacy ratio below the minimum as prescribed.
Jan 11, 2024 – CBN appoints Oni, Ringim, Imam, and others to lead Union, Polaris, and Keystone Banks
The acting Director of Corporate Communications, Sidi Hakama, affirmed the appointment in a statement made available to the press on Thursday morning, saying that the appointment takes immediate effect.
The CBN statement read, “Following the dissolution of the Board and Management of Union Bank, Keystone Bank, and Polaris Bank on Wednesday, January 10, the CBN has appointed new executives to oversee the affairs of the banks.”
For Union Bank, Yetunde Oni was appointed Managing Director and Chief Executive Officer, while Mannir Ubali Ringim was appointed Executive Director.
For Keystone Bank, Hassan Imam was appointed Managing Director and Chief Executive Officer, while Chioma A. Mang was appointed Executive Director.
In the case of Polaris Bank, Lawal Mudathir Omokayode Akintola was named Managing Director/Chief Executive Officer, while Chris Onyeka Ofikulu was appointed Executive Director.