CBN Revokes Operating Licences of 183 MFBs, PMBs

•NDIC steps in, assures customers of speedy resolution of claims, says no cause for panic

James Emejo in Abuja

The Central Bank of Nigeria (CBN) yesterday announced the revocation of operating licenses of 179 Microfinance Banks (MFBs) and four Primary Mortgage Banks (PMBs).

The central bank Governor, Mr. Godwin Emefiele, while announcing the suspension of licences said the affected financial entities had ceased to carry on the type of business for which their licences were issued for a continuous period of six months in the country.

This came as the Nigeria Deposit Insurance Corporation (NDIC) immediately assured depositors of the closed banks of speedy payment of their insured sums.

In a statement obtained from the CBN website, Emefiele also said the closed MFBs and PMBs had failed to fulfill or comply with the conditions subject to which their licences were granted or failed to comply with the obligations imposed upon them by the apex bank, in accordance with the provisions of Banks and

Other Financial Institutions Act (BOFIA) 2020, Act No. 5.

The central bank governor said, “Now, therefore,

I, Godwin Ifeanyi Emefiele, CON, Governor of the Central Bank of Nigeria, in exercise of the powers conferred on the Central Bank of Nigeria under Section 12 of BOFIA 2020, Act No.5, hereby revoke the licences of the Microfinance Banks, Finance Companies and Primary Mortgage Banks stated in Schedules I, II and III respectively attached hereto.

Given under my hand at Abuja this 22nd May, 2023.”

However, in a swift reaction, NDIC Managing Director/Chief Executive, Mr. Bello Hassan, in a statement issued by the NDIC Director, Communication and Public Affairs Department, Bashir Alhassan Nuhu, following the revocation of the licences of the affected MFBs and PMBs by Emefiele, said as deposit insurer, the NDIC would begin the process of payment of the insured sums immediately with the verification of eligible depositors at the respective premises of the closed banks.

Hassan further urged the affected depositors to get the required documents for the exercise such as proof of account ownership, verifiable means of identification, and alternate bank account to facilitate their seamless verification and payment of their insured deposits.

He explained that the insured deposit is the first claim that the corporation pays to depositors upon revocation of the banks’ licence by the CBN, adding that the maximum specified limits for the MFB and PMB sub-sectors are N200,000.00 and N500,000.00 per depositor per bank, respectively.

As liquidator, the NDIC boss disclosed that the corporation has also put machinery in motion to commence the sale of assets of the defunct banks as well as recover debts owed to them in order to declare liquidation dividends on pro-rata basis to the affected depositors with claims exceeding the maximum insured sums of N200,000.00 for MFBs and N500,000.00 for PMBs.

Hassan also assured that regulatory authorities are leaving no stone unturned to ensure that the soundness of the banking system is not compromised, stressing that there is no need for the public to panic over the safety of their bank deposits.