CBN may issue fresh licences to 36 shut MFBs

By Stanley Opara

Tuesday, 19 Oct 2010

The Central Bank of Nigeria may issue fresh licences to 36 of the 244 microfinance banks whose licences it recently revoked.

The Head, Corporate Affairs, CBN, Mr. Muhammed Abdullahi, told our correspondent on the telephone on Monday, that 36 of the banks had claimed that they had recapitalised and met the conditions given by the CBN.

”We have told the Nigeria Deposit Insurance Corporation to put on hold the closure process of the banks pending when the combined team of the CBN and NDIC will go to those banks and verify that what they claim is really what is on the ground,” the CBN spokesperson said.

He said if the CBN and NDIC verified the claims and found out that they had met the conditions given them, they would subsequently be issued new licences.

According to him, the bank does not restore licences it has revoked, but can issue new ones.

He said, ”When we revoke a licence, we cannot restore it. We can only issue a new licence.”

There are speculations that the CBN has restored the licences of 37 of the 244 microfinance banks, whose licences were revoked recently.

The President, NAMB Mr. Matthias Umeh, told our correspondent that some of the banks might be reopened because the CBN was looking into their petitions.

”The process is ongoing,” he said.

The CBN Governor, Mr. Lamido Sanusi, recently commented on the situation, saying, ”If we made errors as the CBN, we would come out to say so, but there were no errors. I think as we continue with the new CBN, people will begin to understand that when we say we will do something, we mean it.”

He added, ”If we look at your institution and we see that you need to recapitalise and we tell you to recapitalise and you don‘t do it, we revoke your licence. When you now start shouting that you‘ve raised money, it doesn‘t matter. This exercise was concluded on June 30, 2010. And we said very clearly that, if your problem is capital, and you show us the evidence that you have put in the capital, you get your licence.”

Sanusi said if the problem was capital and there were other issues that the CBN thought could be resolved, it would give a conditional licence until the issues were resolved.

He added, ”We have had a massive outcry from Nigerians over the past one year on microfinance institutions. You have 1,000 institutions and so we took our time to do a thorough job. If they have raised capital and we verify that they have raised capital, we give them their licence.”


Source: Punch

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