Business

Why we liquidated Fortis Micro Finance Bank-NDIC

We have fully paid all depositors of 18 failed banks – NDIC

 

The Nigeria Deposit Insurance Corporation (NDIC) has given reasons why the corporation resorted to the option of liquidation rather than salvaging the Fortis Micro Finance Bank.

The NDIC made this known in a statement sign by Head Communication and Public Affairs, Mohammed Kudu Ibrahim in which he said after every effort to salvage the bank, the corporation was left with no option than to liquidate the bank.

Ibrahim was recating to a newspaper report (Not AUTHORITHY) which accused both the NDIC and the Central Bank of Nigeria (CBN) of hasty liquidation of Fortis Micro-Finance Bank (MFB).

According to the NDIC, the report relied on statements credited to one Mallam Garba Kurfi, Managing Director of APT Securities and Fund averring that the CBN and NDIC should have managed the affairs of Fortis MFB rather than embark on its outright liquidation.

The report, Ibrahim said also alleged that both the NDIC and CBN did not give consideration to the plight of the depositors of the bank who would be thrown into deep hardship as a result of the liquidation.

“It is pertinent to state that both allegations are false and misleading in every material particular. Operators in the banking system are aware that the liquidation of ailing banks is always the last option adopted by the NDIC after other cost-effective resolution options have failed. In all instances, the safety of depositor’s funds is the primary concern of the Corporation.

“Depositors of banks always come first in the order of settlement of claims in the liquidation process. On the other hand, the shareholders of failed banks are always the last to be paid after the settlement of their depositors and creditors.

“It is however, common knowledge that shareholders are part of the governance structure of the affected banks, through the control they exercise over the Board and Management of their banks during the Annual General Meetings and Extra Ordinary General Meetings, as well as through appointment of Directors and Auditors of their banks.  Accordingly, they cannot be absolved from the misdeeds of their Boards.

“With particular reference to the liquidation of the Fortis MFB, it would be recalled that Fortis MFB was licensed by the Central Bank of Nigeria (CBN) in 2007 and listed on the Nigerian Stock Exchange (NSE).  However, in 2016, the shares of the bank was suspended due to failure to submit its 2016 audited accounts.

“It should be noted that the various examinations and supervisory interventions of CBN and NDIC revealed that the bank was being run in an unsafe and unsound manner leading to huge non-performing loans, high cost of funds (foreign and domestic borrowings, and fixed/term deposits), exorbitant administrative and personnel costs (especially high emoluments to successive CEOs), and poor corporate governance practices, all of which impacted negatively on its financial condition. As a consequence, the bank was illiquid, could not honour its obligations to its depositors, and became insolvent.

“The unhealthy condition of the bank degenerated to the extent that the CBN removed the Management of Fortis MFB Plc in February 2018 and appointed a four (4) person Interim Management Committee (IMC) to take over the control and management of the bank.

“The IMC which comprised of officers drawn from the CBN and NDIC, as well as an independent Chairman, were mandated to steer the bank back to sustainability. The IMC managed the affairs of Fortis MFB Plc for a period 10 months during which it did all it could to resuscitate the bank and began reimbursing depositors, using funds advanced by CBN for that purpose.

“The above is contrary to the claim by Mallam Garba Kurfi, that the CBN/NDIC made no prior attempt to salvage the ailing bank before its eventual liquidation.  Unfortunately, due to the mismanagement of the bank by its erstwhile Board and Management, it could not be salvaged, hence its eventual liquidation,” Ibrahim stated.

Comment With Facebook

Comments (232)

  1. I need to to thank you for this fantastic read!! I certainly enjoyed every bit of it. I’ve got you saved as a favorite to check out new things you post…|

  2. I wanted to thank you for this fantastic read!! I certainly enjoyed every bit of it. I have got you bookmarked to check out new stuff you post…|

  3. Thanks for another excellent article. The place else could anybody get that type of info in such an ideal approach of writing? I have a presentation subsequent week, and I’m at the look for such info.|

  4. I like reading a post that will make people think. Also, thank you for permitting me to comment!|

  5. Basil Gonzales is selected people use to phone him constantly and he totally digs that appoint. My family lives in Puerto Rico and my parents live the nearby. Data processing has been my profession for a few days. I am really fond of to jog and I am starting another thing along can. See what’s new on this website here: #link#

  6. Greetings. Ok, i’ll start by telling the author’s name – Thad. The favorite hobby for him together with his kids will be always to jog but he’s thinking on starting something brand new. Supervising has been her regular job for a bit of time and it’s something she love. My family lives in California and i love often living here. He’s been working on his website for time now. Try it here: #link#

  7. I’ve learn several excellent stuff here. Certainly worth bookmarking for revisiting. I wonder how much attempt you set to make the sort of great informative web site.|

  8. Good day I am so excited I found your weblog, I really found you by error, while I was researching on Yahoo for something else, Regardless I am here now and would just like to say kudos for a remarkable post and a all round enjoyable blog (I also love the theme/design), I don’t have time to go through it all at the moment but I have saved it and also included your RSS feeds, so when I have time I will be back to read much more, Please do keep up the great b.|

  9. Good day! Do you know if they make any plugins to assist with Search Engine Optimization? I’m trying to get my blog to rank for some targeted keywords but I’m not seeing very good success. If you know of any please share. Many thanks!|

  10. Hey just wanted to give you a quick heads up. The words in your post seem to be running off the screen in Firefox. I’m not sure if this is a format issue or something to do with browser compatibility but I figured I’d post to let you know. The design and style look great though! Hope you get the problem resolved soon. Cheers|

  11. For excellent service and value for all of your air con, house comfort and indoor air quality wants in Los Angeles County, name and communicate with Cole Services Air Conditioning 24 hours, 7 days.

  12. Thanks for sharing such a good thinking, article is fastidious, thats why i have read it completely|

  13. I have read several excellent stuff here. Definitely value bookmarking for revisiting. I surprise how so much attempt you place to make such a great informative web site.|

  14. Hi there Dear, are you in fact visiting this web site regularly, if so after that you will without doubt obtain fastidious experience.|

  15. I am really enjoying the theme/design of your website. Do you ever run into any web browser compatibility problems? A handful of my blog visitors have complained about my website not working correctly in Explorer but looks great in Opera. Do you have any ideas to help fix this issue?|

  16. I used to be suggested this web site by my cousin. I’m now not positive whether this submit is written by him as no one else realize such certain approximately my trouble. You are incredible! Thanks!|

  17. If too much water is allowed to remain within the system,
    or oppositely that an excessive amount of is allowed to flee,
    then your air conditioner isn’t running because it ought to.

  18. Superb post however I was wanting to know if you could write a litte more on this subject? I’d be very thankful if you could elaborate a little bit further. Thank you!|

  19. Miss will be the name I love be called with eventhough it is not the name on my birth instrument. One of the very best things in the globe for him is archery and now he has time to consider new . I am currently an administrative assistant and it’s something Thought about enjoy. Vermont is the only place he’s been located in. Check out the latest news on my website: #link#

  20. I appreciate, result in I discovered exactly what I used to be looking for. You have ended my four day lengthy hunt! God Bless you man. Have a great day. Bye|

  21. Since the admin of this web page is working, no uncertainty very soon it will be well-known, due to its feature contents.|

  22. Asking questions are genuinely nice thing if you are not understanding something totally, except this paragraph gives nice understanding even.|

  23. Hi presently. My name is Magali though I am really like being called like very. His day job is a procurement specialist. For a while he’s visited Puerto Rico and his parents live nearby. As a woman what she really likes is solving puzzles leaped she is intending to build an income with it. She is running and maintaining weblog here: #link#

  24. certainly like your web-site however you need to take a look at the spelling on several of your posts. Several of them are rife with spelling issues and I to find it very bothersome to tell the truth then again I’ll definitely come again again.|

  25. I’ve been exploring for a bit for any high-quality articles or blog posts in this sort of house . Exploring in Yahoo I finally stumbled upon this web site. Reading this information So i am happy to convey that I’ve a very good uncanny feeling I discovered exactly what I needed. I most definitely will make certain to don?t overlook this site and provides it a glance on a continuing basis.|

  26. I don’t even know the way I finished up right here, but I thought this put up was good. I don’t recognise who you are but definitely you are going to a famous blogger in case you aren’t already. Cheers!|

  27. I like the valuable info you provide in your articles. I’ll bookmark your weblog and check again here regularly. I’m quite sure I’ll learn many new stuff right here! Good luck for the next!|

  28. Link exchange is nothing else but it is simply placing the other person’s webpage link on your page at appropriate place and other person will also do same in favor of you.|

  29. Aw, this was an incredibly good post. Spending some time and actual effort to produce a really good article… but what can I say… I procrastinate a whole lot and don’t seem to get anything done.

Comment here

This site uses Akismet to reduce spam. Learn how your comment data is processed.