HERITAGE BANK NOT IN DISTRESS, SAYS CBN, IS THAT ALL?

The Central Bank of Nigeria (CBN) yesterday, through a post on its website signed by Acting director of corporate communications. Isaac Okorafor put its reputation on the line by saying authoritatively that Heritage Bank PLC is not in distress.

According to the notice, this was in response to allegations in the social media that the Bank was in trouble having being run aground by feuding directors.

It declared " We wish to state that Heritage Bank is not in distress and as such its depositors should go about their transactions without fear"

It added: "For the avoidance of doubt, we wish to further state that no Nigerian bank is in distress"

Hence, it said " The CBN wishes to reiterate that the banking system remains resilient enough to weather the current economic storm"

Of course, this is reassuring but, is that all? The statement says nothing about the rather weighty allegations in the Sahara reports story published easier about reported goings on at Heritage Bank.

The notice addresses the allegation of chronic liquidity squeeze on the bank but says nothing about other equally weighty allegations.

Sahara reports alleged that some directors of the bank have been abusing their positions and stakeholders trust by diverting domiciliary deposits; employing, promoting, and posting staff based on loyalty to three contending groups within the board of directors; and tinkering with monies that should be paid to the federal TSA accounts by some government agencies.

The managing director was alleged to have laundered N12.8bn; in addition to allegations that some CBN officials and some pension staff had been bribed in the past to look the other way or ensure retention of pension funds.

These are very weighty allegations especially when it is recalled that Heritage Bank shareholders a couple of days at the bank's AGM gave the nod for going public after approving creation of new shares to increase issued share capital and also convert them to 50k nominal value shares from N1 hitherto.

One would want to believe that the CBN had set up a special panel or unit to investigate these allegations or even call in the EFCC before or while issuing the reassuring statement.

If it did, then someone did not appreciate that stakeholders needed to be so informed as well.

If it did not, then the blanket reassurance is suspect. It does not matter that it is possible that a losing or bruised group in the bank is now fighting back.

The way the matter is handled can even out Heritage Bank in trouble if it was never in distress before.

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