Polaris Bank has lost N26.005 billion worth of loans granted to 6 ex-directors, mostly without collaterals.
Economy Post found from the bank’s 2022 annual report that 5 out of the six ex-directors did not perfect their collaterals before receiving the loans from the bank.
Only one ex-director, Jason Fadeyi of Newcross Exploration and Production, who collected N25.442 billion term loan from the bank, perfected his collaterals.
However, the term loan given to him was recorded as “lost,” meaning that it was not recovered by the bank.
From the Corporate Affairs Commission (CAC) records, Newcross Exploration and Production was registered on July 9, 2013, with Festus Fadeyi and Bolaji Ogundare as persons with significant control of the company.
Fadeyi borrowed another N30.922 billion term loan from the bank – which has been placed on the watchlist.
Placing a loan on a watch list means that “a list (a subset) from a universe of securities, loans or other financial instruments is identified for more intense monitoring,” according to the Open Risk Manual.
Based on Polaris Bank’s records, Ibiyi Ekong of Demanta Nigeria Limited is another ex-director who took loans from the bank without repaying them.
Ekong, a former executive director of the bank who resigned in 2016, owes the bank N89 million.
The bank recorded it as loss, with her collaterals not perfected.
Collateral perfection allows a legal claim to seize assets of a payor defaults, according to Investopedia, an online investment dictionary.
She now works at the Foundation for Partnership Initiatives in the Niger Delta.
Ekong also owes the bank N4 million borrowed as a mortgage loan and another N4 million taken as an auto loan, which was not repaid.
Bank records showed their collateral perfection statuses were described as “not applicable.”
Next is Timothy A. Oguntayo, who took N100 million mortgage loan but did not pay it back, prompting the bank to report it as loss.
The bank said that his collateral perfection status was “not applicable.” When someone’s collateral perfection status reads “not applicable,” it means the person is not mandated to present collateral for a loan, experts said.
Oguntayo is a former managing director of Skye Bank (now Polaris Bank), who was earlier charged by the Economic and Financial Crimes Commission (EFCC) but later exonerated.
Oguntayo also owes Polaris Bank a mortgage loan of N100 million, which was also recorded as “lost.” It means he did not pay back both loans.
Abimbola Izu, another ex-director, got N103 million mortgage loan from Polaris Bank but did not repay it, according to bank records.
Her collateral perfection status was also recorded as “not applicable.”
Bank records also showed that Izu took a term loan of N17 million with another “not applicable” collateral status.
Izu is a lawyer and principal advisor at Portalls Advisory Services.
Theodora Amaka Onwughalu is another ex-director who borrowed N19 million mortgage loan from Polaris Bank but did not pay it back. Her loan was recorded as “lost,” with collateral perfection status classified as “not applicable.”
Onwughalu is the chief executive officer of Blueshield Financial Services Limited and was the former group managing director of Mainstreet Bank Limited.
Similarly, Dotun Adeniyi, an ex-director of Polaris Bank, borrowed N27 million mortgage loan from the financial institution but did not repay it.
The loan was recorded as “lost.” The collateral perfection status was also described as “not applicable.” Adeniyi resigned from the former Skye Bank ( now Polaris Bank) board in 2016 during a shakeup, which saw all the board members resign their positions at the bank. According to bank records, the ex-directors took these loans while they were members of the board of the bank.
Tokunbo Abiru, now a Lagos senator, was appointed the managing director of the then Skye Bank in 2016 but resigned in 2020 to fulfil his political ambition. Adekunle Sonola is the current managing director of the bank.
As of December 31, 2022, total outstanding loans owed by these ex-directors of Polaris Bank, some of which would not be repaid, amounted to N 57.473 billion.
Management contributed to collapse of Skye Bank
In 2018, the Central Bank of Nigeria (CBN) revoked Skye Bank’s license and set up a bridge bank known as Polaris Bank. Skye Bank’s problems began when it used short-term funds to buy another bank, Mainstream Bank, in 2014, according to Reuters.
The Nigeria Deposit Insurance Corporation (NDIC) had accused the former management of the bank of being major contributors to the bank’s collapse, Reuters reported.
The CBN took over the bank in 2018 and injected N1.3 trillion to recapitalise and rehabilitate it.
As of 2018, the defunct Skye Bank Plc operated 300 branches across the country, employing over 500 staff members.
The bank was accused of poor corporate governance and inept management, which are evident in the loans taken without collateral and repayment.
Strategic Capital Investment Limited emerged as the preferred bidder for Polaris Bank in 2022, paying N50 billion.
It was given 25 years to repay the N1.3 trillion injected by the apex bank into the bank.
Experts call for strong corporate governance
Financial experts have urged other financial institutions to learn lessons from the defunct Skye Bank and strengthen their corporate governance structures.
“Some banks still have issues with corporate governance. It is obvious, from what you have said, that there was a total collapse of corporate governance at the defunct Skye Bank,” said an Abuja-based financial analyst, Uko Amadi.
“I guess the CBN was a bit late and did not act fast. However, banks should begin to examine themselves to ensure that things are done transparently. They are custodians of people’s money but should not act as if the deposits are theirs,” he noted.
An ex-bank worker, Chinyere Ogundamisi, said there was a need for regulators to pay a closer attention to activities of financial institutions.
“I am not for over-regulation because I think there is already over-regulation of the banking system. But I am saying that if you are regulating, get experienced people who know where loopholes should be to do the monitoring. Some persons at the CBN never worked in banks, and cannot detect some sharp practices. So, get people who worked in banks and allow them to do the monitoring.”
Bank keeps mute
Bolarinwa Rasheed, head of Corporate Communications, Polaris Bank, did not respond to questions regarding why the loans were lost even though the people were still alive.
He promised to get back to us but did not do so as at the time of going to press.
Credit: Economy Post
CBN to Freeze Accounts without BVN, NIN April 2024
The Central Bank of Nigeria has directed a “Post no Debit” restriction on all bank accounts without a Bank Verification Number and National Identification Number effective April 2024.
“Post No Debit” is a term used to describe a restriction imposed by banks on specific accounts, preventing customers from making withdrawals, transfers, or any other debits from their accounts.
This measure effectively freezes the funds in the account, rendering it inaccessible for the duration of the restriction.
The CBN’s directive was contained in a circular issued by the apex bank and sent to all deposit money banks on Friday.
The Central Bank also stated that all the BVN or NIN attached to and/or associated with all ccounts/wallets must be electronically revalidated by January 31, 2024.
The circular was jointly signed by the Director, Payments System Management Department, Chibuzo Efobi, and Director, Financial Policy and Regulation Department, Haruna Mustapha.
The bank said the directive was part of efforts to promote financial system stability and strengthen the Know Your Customer procedures in all financial institutions.
It also amended Section 1.5.3 of the Regulatory Framework for BVN to ensure mandatory registration of all tier-1, 2, and 3 bank accounts and wallets with BVN or NIN.
The circular read, “As part of its efforts in promoting financial system stability, it becomes necessary to strengthen the Know Your Customer procedures in financial institutions under the purview of the Central Bank of Nigeria.
“Accordingly, the CBN hereby issues an amendment to Section 1.5.3 of the Regulatory Framework for Bank Verification Number Operations and Watch List for the Nigerian banking industry.
“In this regard: it is mandatory for all Tier-1 bank accounts and wallets for individuals to have BVN and/or NIN. It remains mandatory for Tiers 2 & 3 accounts and wallets for individual accounts to have BVN and NIN.
“The process for account opening shall commence by electronically retrieving BVN or NIN related information from the NIBSS BVN or NIMC’s NIN databases and for same to become the primary information for onboarding of new customers.
“All existing customer accounts/wallets for individuals with validated BVN shall be profiled in the NIBSS ICAD immediately and within 24 hRS of opening accounts/wallets.”
As a result of the new guidelines, the bank said any unfunded account/wallet shall be placed on “Post No Debit or credit until the new process is satisfied.
It added that all accounts/wallets will be electronically revalidated by January 31, 2024.
The circular further read, “Effective immediately, no new Tier1 accounts and wallets should be opened without BVN or NIN,
“For all existing Tier1 accounts/wallets without BVN or NIN: i. Effective immediately, any unfunded account/wallet shall be placed on “Post No Debit or credit until the new process is satisfied.
“Effective April 1, 2024, all funded accounts or wallets shall be placed on “Post No Debit or Credit, and no further transactions permitted.
“The BVN or NIN attached to and/or associated with all accounts/wallets must be electronically revalidated by January 31, 2024.”
Continuing, CBN further directed all Executive Compliance Officers, Chief Compliance Officers, or Heads of the Compliance Functions to acquaint themselves with the attached guidance notes to ensure full and uniform compliance.
“To ensure uniform and full compliance, the Executive Compliance Officers, Chief Compliance Officers, or Heads of the Compliance Functions are advised to acquaint themselves with the attached Guidance Notes which becomes applicable to ALL institutions regulated by the CBN.
“Also, a comprehensive BVN and NIN audit shall be conducted shortly and where breaches are identified, appropriate sanctions shall be applied.
“Finally, all financial institutions regulated by CBN are required to apply strict compliance on restrictions on Tier1 accounts/wallets as they relate to limits on transaction values and cumulative balances,” the circular concluded.
Zenith Bank Signs Mou With Cfa Institute to Develop Finance and Investment Professionals
Zenith Bank Plc has signed a Memorandum of Understanding (MoU) with the Chartered Financial Analyst (CFA) Institute to promote efforts and activities that support the formation, training, and updating of human capital in finance and investment for the overall development of the Nigerian financial services sector.
The MoU was signed by Dr. Ebenezer Onyeagwu, the Group Managing Director/CEO of Zenith Bank Plc,; the President/CEO of the CFA Institute, Margaret Franklin; and the President of CFA Society Nigeria, Ibukun Oyedeji on Tuesday.
Speaking at the MoU signing ceremony, Dr. Ebenezer Onyeagwu, the Group Managing Director/CEO of Zenith Bank Plc, commended the CFA Institute and the CFA Society, Nigeria for their laudable programmes in developing finance and investment professionals in Nigeria.
According to him, your Women in Investment Management Initiative, CFA Institute Research Challenge, CFA Society Nigeria Ethics Challenge and University Affiliation Program are very laudable, and Zenith Bank will continue to partner with the CFA Institute and the CFA Society Nigeria to ensure that young finance and investment professionals get the needed support for their career development.
In his words, “As a good corporate citizen, Zenith Bank remains committed to furthering the economic, cultural and social development of the society. As such, we continue to support projects and initiatives that have long-term social and economic benefits for our various publics and stakeholders.
“Partnering with the CFA Institute and the CFA Society Nigeria is therefore a demonstration of our commitment to building professional excellence in the finance services industry in Nigeria”.
At the CFA Institute Africa Investment Conference, during the ‘Journey to the Top: A Discourse with CEOs’ segment, Dr. Onyeagwu inspired future finance and investment professionals to uphold the highest standards of integrity. He stressed the importance of making difficult yet high-quality decisions, building robust networks, and dedicating themselves to hard work for career success.
In his words, “as upcoming professionals, the opportunities are immense for you. Africa doesn’t get bigger than Nigeria.
There is scarcity of the right kind of people that have the talent, that have the character and the leadership to provide leadership in organizations.
Make a decision to be one of those, make a decision to be different. You must be driven by your passion; you must delay gratification. In Zenith what is driving us is the strive for excellence. It is not about who you are and where you come from. We have the best class of talents you can think of anywhere in the world.”
He assured the young finance and investment professionals that Zenith Bank will offer immediate employment opportunity to CFA Charter Holders and those who qualify as Chartered Accountants.
Also speaking on the MoU, the President/CEO, CFA Institute, Margaret Franklin reiterated the Institute’s commitment to the professional development of students and upcoming professionals. In her words, “there are many things that we do for students, we invest heavily in students and why is that? Because they are our future.
The mission of the CFA Institute is to lead the investment industry with the highest standards of ethics, education and professional excellence for the ultimate benefit of society and that starts with our CFA programme”.
She commended Zenith Bank for its continued support to the CFA Society Nigeria and sponsorship of the CFA Institute Research Challenge over the years. She also commended the bank for being one of the top employers of CFA members in the country.
She expressed her admiration of the culture of excellence in Zenith Bank. Also speaking at the MoU signing ceremony, the President of CFA Society Nigeria, Ibukun Oyedeji commended Zenith Bank for its partnership with CFA Society Nigeria and its commitment to the development of young finance professionals in the country.
The the CFA Institute Africa Investment Conference is being hosted by the CFA Institute and CFA Societies from Ghana, East Africa, South Africa and Mauritius.
The conference has representatives from over 20 universities in Nigeria (members of their investment clubs being supported by CFA Society).
PalmPay Releases 5 Financial Safety Tips to Master Before the Holiday Season
As the holiday draws near, fraudsters are on the prowl for whom to defraud using dubious shopping websites and posing on social media platforms as customer support agents of legitimate businesses to steal your identity.
While activities of online fraudsters are more sophisticated and are posed to spike during the holiday season, according to reports, other types of frauds that fraudsters are likely to use in defrauding you include digital loan scams, one-time password (OTP) scams, giveaway campaign scams, and free gift or voucher scams.
Aside from the security measures put in place by businesses such as banks, fintechs and online shopping stores, you owe it to yourself to take some safety precautions when conducting financial transactions during this holiday season.
In an interview in Lagos recently, Kevin Olumese, Senior Marketing Manager, PalmPay, rolled out financial safety tips everyone should master before the holiday season beckons.
Mr Olumese noted that as the holiday draws near, fraudsters would be on the prowl seeking whom to defraud using dubious shopping websites and posing on social media platforms as customer support agents of legitimate businesses to steal your identity.
“Aside from security measures put in place by businesses such as banks, fintechs and online shopping stores, you owe it to yourself to take some safety precautions when conducting financial transactions during this holiday season,” Mr Olumese cautioned.
He listed some easy safety tips to save yourself from fraudsters this holiday including but not limited to the following:
Shop from secure retail outlets
Shoppers this holiday season will see an increase in dubious shopping websites, with some of them offering ridiculous discounts to attract unsuspecting shoppers to input their debit card details which would be stolen by fraudsters.
Do not shop on an online retail store that you don’t trust or haven’t used before, it doesn’t matter whether they are offering the best discount. Moreso, if the discounts they are offering look too good to be true, it’s probably because it is not true.
Shop using verified online websites or payment apps that are secure and seamless. Payment apps like PalmPay have been integrated with different business outlets, allowing you to pay your bills and utilities securely and with ease.
Use only trusted POS machines
Whether you want to withdraw cash to spend this holiday season or make payments using a point of sale (POS), it is good that you thread carefully and only patronise POS agents that have terminals of fintech brands that you can trust.
Stay vigilant and watch out for possible irregularities while patronizing POS agents. To ensure that the details of your card are not stolen, hide them and do not input your personal identification number (PIN) in the presence of other people.
Using POS terminals of trusted fintech companies cannot be emphasised enough. For ease of transaction, use POS terminals that offer a good network, a reliable system with less than one percent failure rate, an option to know banks’ network updates in real-time, and 24/7 quick customer dispute resolution.
Be wary of unsolicited calls, emails and texts
Expect to receive several unsolicited phone calls, emails and text messages from scammers claiming to be from businesses that you know. Some of these calls, emails and texts would claim that you’ve won a discount or holiday giveaway from a trusted business and would ask you to pay some money to enjoy the discount or giveaway.
Do not fall for this trick. Legitimate businesses will not ask you to pay money to enjoy a giveaway promotion or require that you send sensitive bank details to be granted access to a discount. Beware! No staff or agents of PalmPay will call or text you to ask for money or sensitive information in exchange for a coupon or a discount.
Research discounts, giveaways
This brings us to the next and one of the most important safety tips to always apply during this holiday season and after. Always do your research on purported discounts and giveaway challenges supposedly coming from trusted brands.
During the holiday, whenever you come across an ongoing giveaway promotion, go to the official social media accounts and websites of the brand to verify. Any discount or giveaway challenge that is not communicated to the public through the official social media channels of a legitimate business should be viewed cautiously.
Every discount and giveaway by PalmPay is usually posted on the company’s social media pages. Follow the right handles on Instagram, Facebook, X (formerly Twitter), TikTok and LinkedIn, and always look out for the verified check marks.
Avoid fraudulent fintech apps
Do not give out your personal information and bank details to fintech platforms that you do not trust. It is important that we repeat this safety warning. Do not download fintech apps that are not regulated by the government.
Loan or fintech apps that are not regulated by the Central Bank of Nigeria (CBN) and whose deposits are not insured by the Nigeria Deposit Insurance Corporation (NDIC) should be avoided completely. Before downloading any fintech or loan app, conduct your research to ensure that they boldly carry the CBN and NDIC badges.
Aside from being regulated by the CBN and insured by NDIC, at PalmPay we go the extra mile to ensure that our over 30 million users and the more than 1.1 million businesses that are part of our payment ecosystem are safe from fraudsters. Follow our social media handles to stay up-to-date on safety guidelines.
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