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Worries as Nigerian govt seeks to prosecute those responsible for Skye Bank’s failure

Worried as Nigerian govt seeks to prosecute those responsible for Skye Bank’s failure

The Federal Government has assured Nigerians that everyone responsible for the failure of the defunct Skye Bank will be prosecuted.

The Minister of Finance, Zainab Ahmed, gave the assurance on Friday while on a courtesy visit to the Nigerian Deposit Insurance Corporation (NDIC) in Abuja.

This is coming barely two weeks after NDIC Managing Director, Alhaji Umaru Ibrahim, revealed that the bank’s Directors were being investigated for their role in the erosion of its assets value.

Ripples Nigeria had examined the circumstances that led to the collapse of Skye Bank and how some powerful forces in the Lagos State government and the bank’s officials had contributed in bringing it down.

Recall that the Central Bank of Nigeria (CBN) had on September 22 revoked the operating license of Skye Bank Plc. and appointed a bridge bank – Polaris Bank – to assume all the assets and liabilities of the defunct bank and the failure of its shareholders to recapitalise the bank.

The decision to revoke the bank’s license followed a forensic audit conducted by the apex bank which revealed that the Skye Bank had slipped into negative capital of N786 billion largely driven by its increasing non-performing loans.

A former Chairman of Skye Bank’s Board, Tunde Ayeni, reportedly used his position to take huge loans from the bank to secure the control of the Ibadan and Yola Electricity Distribution Companies (DisCos) in 2013.

Read also: Designed to crash: How directors, ‘powerful forces’ in Lagos raped Skye Bank to death

Thereafter, the bank’s record of non-performing loans and profits worsened, causing the bank to operate at a loss of N40.73 billion in 2015.

It was against this backdrop that Nigerians raised concerns on the need for the government through the financial regulator and anti-graft agencies to investigate what led to the downfall of the bank.

The minister during her visit directed Ibrahim to ensure that a thorough investigation is carried out on the failure of the bank, noting that anyone found culpable at the end of the investigation would be prosecuted.

“We would find out what happened. Your investigation must be thorough, we are going to hold whoever is responsible for the failure of that bank.

“We have to show some examples. We cannot just be bailing out banks and leaving perpetrators of the failure of these banks to go scot-free.

“Even though you – NDIC – intervene by protecting depositors, but your intervention is limited. You’re not able to pay back all that the depositors have. We must show some examples and this is a good one for us to start with,” the Minister said.

Ahmed urged the corporation to continuously monitor all banks so that problems were spotted and solved early.

“The role that you have in monitoring banks should be continuous, because if you capture these issues early, there is a better chance of us protecting these banks, protecting shareholders and depositors,” she said.

Despite government’s assertions, there are fears in many quarters that those who contributed to the death of the former Skye Bank may yet escape justice with the proceeds of their crime.

The fears are fueled by the nation’s judicial process, which is seen as highly susceptible to antics of a few, especially lawyers and judicial officers who seem to have perfected ways of manipulating the system to their advantages, using resources at their disposal.

 

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Ripples Nigeria

We are an online newspaper, very passionate about Nigerian politics, business and their leaders. We dig deeper, without borders and without fears.
www.ripplesnigeria.com

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