Reps Orders CBN To Suspend Sale of Polaris Bank

 

The Central Bank of Nigeria (CBN) has been ordered to immediately suspend the sale of Polaris Bank Plc.

 

The directive was given by the House of Representatives on Wednesday, according to a report by NAN. 

 

This followed the adoption of a motion of urgent public importance by Rep. Henry Nwauba (APGA-Imo) at the plenary on Wednesday.

 

According to him, public attention had been drawn through a circulation currently on social media in respect of the proposed sale of Polaris Bank for N40 billion.

 

He said that there was a need to ensure that the divestment in the bank did not jeopardize the core reason for the CBN intervention in the bank in the overall public interest.

 

Nwauba added that the divestment should be done most transparently following the required due process.

 

He said that this was necessary to avert public outcry and untoward reaction from critical stakeholders in the economy, foreign business partners banking community, depositors, and Correspondent banks.

 

The lawmaker added that it was crucial to avoid the shortcomings of the previous similar exercise undertaken in the past.

 

Polaris Bank was borne out of the bailout of the defunct Skye bank Plc that failed due to poor corporate governance and non-performing loan, he explained.

]

This, he said, was for which close to a trillion Naira of public funds was committed to resuscitating the bank.

 

Furthermore, he noted that the proposed sale was shrouded in secrecy and was opaque and required that it was done with transparency and accountability to eliminate insinuations of corruption.

 

Therefore, the House set up an Ad hoc Committee to within 20 days, review the total outlay by the Federal Government of Nigeria in Polaris Bank and account for the entire financial input in the bank by the Federal Government.

 

The House said this should be through CBN, NDIC and AMCON to determine whether the conditions and terms of sale were likely to ensure a positive return on public funds thus far committed to the bank, whether as bailout funds or other investments.

 

Also, that the suspension should be until the CBN Deposit Insurance Corporation and the Asset Management Corporation of Nigeria concluded all processes for an open, transparent, and competitive bid process.

 

This, the house said, should be in line with best practices and procedures for divestment of this nature.

 

Meanwhile, the House urged the committee to ensure that the public funds committed to Polaris Bank were appropriately documented and accounted for.