The Central Bank of Nigeria (CBN) has undertaken a significant supervisory action, dissolving the boards and management of Union Bank, Keystone Bank, and Polaris Bank. This decision stems from concerns regarding the banks’ adherence to regulations and corporate governance principles. The CBN cited non-compliance with specific provisions of Section 12(c), (f), (g), and (h) of the Banks and Other Financial Institutions Act, 2020. These concerns encompass a range of issues, including regulatory non-compliance, disregarding the conditions under which their licenses were granted, and engaging in activities potentially detrimental to financial stability.
Following this release, the CBN appointed new executives to oversee the affairs of the banks.
- Union Bank: Yetunde Oni – Managing Director/Chief Executive Officer Mannir Ubali Ringim – Executive Director
- Keystone Bank: Hassan Imam – Managing Director/ Chief Executive Officer Chioma A. Mang – Executive Director
- Polaris Bank: Lawal Mudathir Omokayode Akintola – Managing Director/ Chief Executive Officer Chris Onyeka Ofikulu – Executive Director
In our view, this action underscores the CBN’s unwavering commitment to maintaining a robust and well-regulated banking sector. Considering the affected banks are not publicly traded vis-a-vis the uniqueness of this event, we do not see the dissolution having a significant impact on overall equity market performance. However, it is prudent to monitor the situation closely, assess its potential impact on market sentiment and investor behavior, particularly within the banking sector.