Heritage Bank: Obi Faults Federal Government, Offers Options

Heritage Bank

OpenLife Nigeria reports that Presidential candidate of Labour Party in the 2023 general elections, Mr. Peter Obi has faulted federal government’s line of action in revoking the operating licence of Heritage Bank.

The former Anambra State governor stated that the decision has “far reaching impact on bank’s depositors,” capable of worsening the bad economic situation in Nigeria.

It would be recalled that in the early hours of Monday, June 3, 2024, the Central Bank of Nigeria, CBN, through a circular, revoked the operating licence of Heritage Bank.

In a statement issued by CBN acting Director, Corporate Communications, Mrs. Hakama Sidi Ali, the apex bank said the move was in accordance with its mandate to promote a sound financial system in Nigeria and in exercise of its powers under Section 12 (1l of the Banks and Other Financial Act (BOFIA) 2020.

The central bank pointed out that the Board and Management of the bank had not been able to improve the bank’s financial performance, a situation which constitutes a threat to financial stability.

This followed a period during which the CBN engaged with the bank and prescribed various supervisory steps intended to stem the decline.

Sidi Ali said, “Regrettably, the bank has continued to suffer and has no reasonable prospects of recovery, thereby making the revocation of the license the next necessary step.”

Reacting through a piece oh his Facebook wall, Obi stated that “Given the harsh economic realities in the country now, I will urge the federal government via NDIC to ensure immediate payment of all depositors in Heritage Bank in full to help alleviate the prevailing hardship the people are going through in the country.”

His thoughts are reproduced below unedited

The latest CBN’s revocation order on Heritage Bank’s operating license and subsequent appointment of NDIC as liquidator of its assets though affirmed by the regulators as necessary at this point to enhance financial stability, has a far-reaching impact on the bank’s depositors.

Given the harsh economic realities in the country now, I will urge the federal government via NDIC to ensure immediate payment of all depositors in Heritage Bank in full to help alleviate the prevailing hardship the people are going through in the country.

Many individual savers and SMEs are already groaning under severe negative effects of the economy and already living in abject poverty.

These depositors depend on the savings they have in the now-liquidated bank to survive.

Any attempt to deny or delay payment to these depositors would worsen their economic woes and could lead to a crisis of confidence in the banking system.

Anything short of immediate and full payment can create panic in the banking sector which our already fragile economy cannot afford.

On no account should the actions of government through the CBN destabilize the financial system or shake public confidence in the integrity of the system.