CBN Wields The Big Stick, Takes Over Union Bank, Others

The Central Bank of Nigeria (CBN) has declared a take- over of Union Bank, Titan Trust Bank, Polaris and Keystone Bank, The dramatic take-over of the banks is in response to the findings of the Special Investigator, Jim Obazee, whose report implicated these banks in alleged financial irregularities.

President Bola Tinubu, acting on the recommendations of the Special Investigator, instructed CBN Governor Yemi Cardoso to dismiss the managements of the four banks and dissolve their Boards. 

This directive was promptly executed as the affected banks’ managements were summoned to the CBN’s headquarters in Abuja, where their operating licenses were withdrawn, and their Boards dissolved.

Union Bank, Titan Trust Bank, Polaris, and Keystone Bank, all major players in the financial landscape, now find themselves under the direct control of the Federal Government (FG) through the CBN. 

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The swift takeover occurred during an emergency meeting presided over by Governor Cardoso.

As part of the restructuring process, Union Bank and Titan Trust Bank are set to undergo a merger, consolidating their assets into a single entity. Similarly, Polaris and Keystone Bank will be merged, reshaping the landscape of Nigeria’s banking industry. 

The government, acting through the CBN, will appoint new managements and Boards for the emerging banks, with names like “Nigeria National Bank” and “National Bank of Nigeria” already in consideration.

The action follows the Special Investigator’s report, which accused the former CBN governor, Godwin Emefiele, of utilising stolen funds to acquire Union Bank and Keystone Bank through proxies. 

The investigation, initiated late last year, faced resistance from key figures implicated in the report, including TTB Chairman Tunde Lemo and major foreign shareholders Cornelius Vink and Rahul Savara.

Despite their non-compliance with invitations for further interrogation, the Special Investigator issued a “final warning” on December 27, threatening the forfeiture of shares to the FG if they failed to attend a scheduled meeting. However, Lemo and the foreign shareholders, citing overseas commitments, deferred the meeting to January 2024.

In response to the CBN’s decisive action, a coalition of 259 anti-corruption, civil society, and human rights groups, known as the Coalition for Transparency and Economic Reforms (COTER), expressed commendation for the Special Investigator’s diligent work.

COTER also lauded  Tinubu for his boldness and determination in addressing corruption within the banking sector, advocating for a special national honour for Jim Obazee’s unwavering commitment to the national duty assigned by the President.