Press "Enter" to skip to content

Bank shareholders want FG, CBN re-open Savannah Bank


..The bank was given opportunity to re-capitalise but failed – Analyst

Shareholders of Deposit Money Banks (DMBs) have again shown their grievances over an endless wait of getting back their bank on track, calling on the Federal Government (FG) and the Central Bank of Nigeria (CBN) to restore the license of Savannah Bank and allow it to be re- opened for operation. Depositors of the bank believe that government’s intervention became essential, due to inability of the bank to refund their trapped funds. However, they said they are tired of a long time hope, which seems non-realizable, as no indication or a likelihood of getting back their closed bank, stressing that the crisis that has bedeviled the bank was political. Speaking on this development in a telephone chat in Lagos over the weekend,

President, Progressive Shareholders Association of Nigeria (PSAN) Mr. Boniface Okezie, said the issue of Savannah Bank is political, and that the Federal Government should restore the license of the bank and allow them to re-open for operation. Okezie explained that Savannah Bank and Heritage Bank which was former Societe Generale Bank were in the same league of troubled banks. “If Societe Generale Bank could be rescued by the Federal Government, Savannah Bank which had no major problem could also be treated same.” According to the PSAN president, the apex bank had caused the bank very endemic damage which is glaring even in their dilapidated assets nationwide. But in a contrary opinion, Managing Director/CEO, APT Securities Limited, Mallam Kurfi Garba, pointed that the owners of Savannah Bank were given the option to re-capitalise and start operations which they failed to do.

“The only way the Federal Government can intervene in the depositor’s trapped funds, is for the bank to be either bailed out by the CBN, or to be handed over to the Nigeria Deposit Insurance Corporation (NDIC), for liquidation. NDIC being a regulator can recover loans and sell whatever assets they could lay hands upon and pay off depositors,” Mallam Kurfi said. Meanwhile, an analyst at Proshare had said Savanna Bank showed no obvious or remote signs of distress that could have precipitated its closure. “The much that was disclosed was that the bank committed some infractions of extan regulations owing to its alleged non-professionalism in aspects of its operations. At the time of its forcible closure, Savannah Bank had nearly 85,000 shareholders, a share capital of N1 billion, and 118 branches. Its depositors were in their hundreds of thousands.” The license was revoked by the Central Bank of Nigeria (CBN) in February 2002.

Immediately thereafter, the Nigeria Deposit Insurance Corporation (NDIC) liquidated the bank. Also, commenting on this development, former CBN governor, Joseph Oladele Sanusi, said the bank was axed for not having enough assets to meet liabilities and did not comply with CBN obligations, adding that the regulators had been unable to prevent further deterioration which caused anomaly in the depositor’s funds. An investor, international resource associates of London, bought 67.35 percent of the shares of Savannah Bank in 1999 before a new management took over on 14 April 2000.

(Visited 2 times, 1 visits today)

Be First to Comment

Leave a Reply

%d bloggers like this: