Central Bank of Nigeria Revokes Heritage Bank’s License Amid Financial Concerns
The Central Bank of Nigeria (CBN) has taken the significant step of revoking the license of Heritage Bank, effective immediately. This decision was communicated through a statement by Hakama Sidi-Ali, the Acting Director of the Corporate Communications Department, on Monday in Abuja.
Sidi-Ali cited the CBN’s mandate to uphold a robust financial system in Nigeria and invoked its authority under Section 12 of the Banks and Other Financial Institutions Act (BOFIA) as the basis for this action. The revocation was deemed necessary due to Heritage Bank’s breach of Section 12(1) of BOFIA and its persistent financial underperformance, posing a threat to financial stability.
Despite engaging with the bank and prescribing supervisory measures to address the decline, Heritage Bank’s financial situation did not improve. Consequently, the CBN determined that revoking the license was the next prudent step to safeguard public confidence in the banking system and prevent any adverse impact on financial soundness.
To oversee the liquidation process, the Nigeria Deposit Insurance Corporation (NDIC) has been appointed as the bank’s liquidator, in accordance with Section 12(2) of BOFIA, 2020. Sidi-Ali assured the public of the continued solidity of the Nigerian financial system, reiterating the CBN’s commitment to maintaining its safety and soundness.
The statement did not speculate on potential legal challenges that often accompany such regulatory actions involving financial institutions. However, it emphasized the CBN’s dedication to ensuring the integrity and stability of Nigeria’s financial landscape.
As stakeholders await further developments, the revocation of Heritage Bank’s license underscores the regulatory authorities’ proactive measures to address financial vulnerabilities and uphold the resilience of the banking sector.
