The Central Bank of Nigeria (CBN) has announced the immediate revocation of the banking licence of Heritage Bank Plc.
This decisive action, taken to promote a sound financial system, comes under the purview of Section 12 of the Banks and Other Financial Act (BOFIA) 2020.
The announcement, signed by Hakama Sidi, Acting Director of Corporate Communications at the CBN, emphasizes the necessity of this measure.
“The Central Bank of Nigeria (CBN), in accordance with its mandate to promote a sound financial system in Nigeria and in exercise of its powers under Section 12 of the Banks and Other Financial Act (BOFIA) 2020, hereby revokes the licence of Heritage Bank Plc with immediate effect,” the statement read.
Heritage Bank’s financial struggles have been ongoing, despite the CBN’s efforts to stabilize the situation. The bank’s persistent breach of Section 12 (1) of BOFIA 2020, coupled with the board and management’s inability to improve financial performance, has led to this outcome.
“This action has become necessary due to the bank’s breach of Section 12 (1) of BOFIA, 2020. The Board and Management of the bank have not been able to improve the bank’s financial performance, a situation which constitutes a threat to financial stability,” Sidi noted.
The CBN had previously engaged with Heritage Bank, implementing various supervisory measures to curb the decline. However, these efforts proved insufficient.
“Regrettably, the bank has continued to suffer and has no reasonable prospects of recovery, thereby making the revocation of the licence the next necessary step,” the statement concluded.
The revocation underscores the CBN’s commitment to maintaining the integrity of Nigeria’s financial system and protecting stakeholders’ interests in the banking sector.
The central bank’s proactive stance aims to prevent further instability and ensure that the financial environment remains robust and trustworthy.