— it is a 2011 sanction — CBN
By Omoh Gabriel
The Central Bank of Nigeria, CBN sanctioned Access Bank Plc for violating the Banks and Other Financial Institution Act (BOFIA) 1991 in 2011 and has also formerly sacked Maduka Cosmas from Access Bank Board of Directors.
The apex bank in the sanction fined Access Bank N3 million for violating its rules and regulations on granting of loans.
However, CBN told Vanguard yesterday that the issue at stake is not new. The CBN official said that the said sanction was based on the examination the CBN carried out on the bank on 30th September 2011.
Vanguard gathered that the CBN wrote Access Bank conveying the fine on August 8th 2012. Access Bank paid the fine with a manager cheque on August 9th 2012. He wondered why the issue is just coming out almost two years after the sanction was imposed and paid.
Access Bank on its part said that Cosmos Maduka stepped down from the board of the bank having spent 12 mandatory years as stipulated by CBN code of conduct for Bank directors.
According to Mr Segun Fafore, Access Bank spokesman, Maduka joined the board of Access Bank in 2000 and his term of service as a non executive director expired in December 2012.
Mr. Maduka had previously stepped aside as director of the bank following the mandatory 12 years service to the bank which some said was as a result of the controversy that surrounded a N34.4 billion sour loan he obtained from the bank to finance the importation of petrol in partnership with Ifeanyi Ubah, the CEO of Capital Oil.
In the CBN August 8th 2012 letter issued by the Banking Supervision Department of the apex bank to Access Bank, the CBN said the sanction was informed by the outcome of a risk based examination carried out on September 30, 2011. The letter reads in part: “The bank contravened Section 20(1) of BOFIA, 1991, as amended by granting credit facilities to Westcom Group to the tune of N38.4 billion which was above its single obligor’s limit of N36.4 billion.
“Contrary to the CBN circular No BSD/9/2004 of 16th July, 2004 which stipulates that credits to directors and their related companies shall not exceed 10 per cent of the paid-up capital without the CBN approval, the bank granted to its following directors; Mr. Gbenga Oyebode, Dr. Cosmos Maduka and Mr.Tunde Folawiyo, facilities in excess of ten percent of its paid-up capital without the necessary regulatory approval. Consequently, penalties totaling N3, 000, 000.00 is imposed on your bank for the above infractions.
But a petition to CBN Governor Sanusi Lamido Sanusi by two minor shareholders of Access Bank Plc, Messrs Godfrey Onyeka and Godfrey Obi Amalu dated January 21, 2013; the duo accused Access Bank of granting loans to Dr. Maduka and two other directors, without following due process.
The petition written by counsel to the aggrieved shareholders, Ime Asanga and Co, reads: “Our clients have become aware of a fraudulent credit facilities made by the bank to three of its directors-Dr. Cosmas Maduka through two of his companies namely: Coscharis Motors Ltd and Sure Comfort Limited here in Nigeria, to Gbenga Oyebode and Tunde Folawiyo. Our clients are desirous of protecting their investments in Access Bank and ensuring that returns on those investments are not unnecessarily depleted, especially when easier, cheaper and more readily available local remedies are provided for under BOFIA.
Accordingly, we have our clients’ instructions to make this complaint to you with a prayer that you invoke the clear provisions of Section 20(6) of BOFIA to recover from the directors of the bank the full amount involved in the obnoxious credit facilities as well as cleanse its Board and Management by removing all the Directors.
Access Bank had in a statement to the Nigerian Stock Exchange (NSE) a few days ago announced Maduka’s “retirement” from the board of the bank, saying his “retirement” is sequel to his completion of the maximum 12 year term as provided by CBN’s Code of Corporate Governance for banks.”
