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Minister Calls For Prosecution Of Defunct Skye Bank Officials

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Nigeria’s minister of finance, Hajiya Zainab Ahmed, has expressed concerns over the rising non-performing loans in the Nigerian banking sector as she called for the investigation and prosecution of directors of the defunct Skye Bank. She directed the Central Bank of Nigeria (CBN), and the Nigeria Deposit Insurance Corporation (NDIC), to fully investigate and prosecute all the directors and executive management who contributed to the collapse of the defunct Skye Bank Plc as well as other deposit money banks (DMBs) in liquidation. Speaking during her familiarisation visit to the executive management of the NDIC led by the managing director and chief executive, Umaru Ibrahim, the minister noted that while the bail-out of distressed financial institutions was necessary in the interest of the stability of the banking system, emphasis should also be placed on the investigation and prosecution of delinquent board directors and executive management of financial intuitions who abused the trust placed on them by depositors.

She urged the CBN and the NDIC to use the recent failure of the defunct Skye Bank Plc as an opportunity to deal decisively with any of its directors and management found culpable in the course of the investigations, so as to serve as a deterrent to other operators in the financial system as the federal government was no longer prepared to treat such serious infractions with levity.
On his part, MD of the NDIC assured that the Corporation would do all it can to assist in the recovery of all the debts owed the defunct Skye Bank and other banks in liquidation. He also expressed the Corporation’s determination to ensure that the directors who perpetrated insider abuse and other illegalities in running the affairs of the bank were investigated and prosecuted by appropriate authorities. The primary concern of the NDIC, he assured the minister, was to ensure the safety of depositors’ funds and minimise the disruption of banking services.
Umaru had earlier revealed that investigations were ongoing on the defunct Skye Bank, promising that the directors of the bank would be handed over to law enforcement agencies if found culpable in the running aground of the bank.

The NDIC chief noted that the Corporation had paid N11.75 billion to depositors, creditors and shareholders of 46 closed banks since 1991,out of which the total payments to insured depositors of deposit money banks (DMBs) amounted to N8.252 billion. He stated that a total of N2.89 billion was paid out to insured depositors of Microfinance Banks (MFBs) covering 81,657 individual accounts, while N69.60 million was also paid to insured depositors of Primary Mortgage Banks (PMBs). A total number of 46 DMBs he further stated, were currently in liquidation.
Umaru assured that the Corporation used the most appropriate failure resolution option in the case of the defunct Skye Bank as it ensured that over 6,000 jobs were saved while its depositors continued to operate their accounts with the new Polaris Bank Limited which assumed its entire assets and liabilities. Responding, the minister commended the NDIC for the thoroughness of its bank examination reports which have become acknowledged in the banking system. She also expressed her appreciation to the Corporation for the prompt payment of its contribution under the Fiscal Responsibility Act, adding that the federal government regarded the NDIC as a critical player towards the actualisation of its Economic Recovery Growth Plan (ERGP).
Earlier, the MD/CE had informed the minister that the total amount paid by the Corporation under the Fiscal Responsibility Act amounted to N175 billion.



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