The Central Bank of Nigeria (CBN) has announced the immediate revocation of Heritage Bank Plc’s banking license due to the bank’s poor financial performance, which threatened financial stability.
Sidi Ali, the Acting Director of Corporate Communication at CBN, made this announcement in a statement released on Monday.
Despite various supervisory interventions by the CBN, Heritage Bank’s management has been unable to halt its financial decline. With no realistic prospect of recovery, the CBN decided to revoke the bank’s license to safeguard the financial system and uphold public confidence.
“The Nigerian financial system remains on a solid footing. We are committed to ensuring the safety and soundness of our financial system, and this action reflects that commitment,” the statement noted.
The Nigeria Deposit Insurance Corporation (NDIC) has been appointed as the liquidator of Heritage Bank, following the regulations set forth in the Banks and Other Financial Institutions Act (BOFIA) 2020.
This measure is viewed as a crucial step by the CBN to maintain financial system stability and protect depositors’ funds. The public has been assured that the revocation of Heritage Bank’s license will not affect the overall health of the financial system.
The CBN’s statement read: “In line with our mandate to promote a sound financial system in Nigeria and exercising our powers under Section 12 of the Banks and Other Financial Institutions Act (BOFIA) 2020, the Central Bank of Nigeria hereby revokes the license of Heritage Bank Plc with immediate effect.
“This decision was necessitated by the bank’s breach of Section 12 (1) of BOFIA, 2020. The Board and Management of the bank have been unable to improve the bank’s financial performance, posing a threat to financial stability.
“After a period of engagement and various supervisory steps taken by the CBN to address the decline, the bank showed no reasonable prospects of recovery, making the revocation of the license the necessary step. Consequently, the CBN has taken this action to reinforce public confidence in the banking system and ensure the soundness of our financial system is not compromised.
“The Nigeria Deposit Insurance Corporation (NDIC) is appointed as the liquidator of the bank under Section 12 (2) of BOFIA, 2020.
“We assure the public that the Nigerian financial system remains robust. The action we are taking today reflects our unwavering commitment to ensure the safety and soundness of our financial system.”
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