CBN Office, Lagos
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CBN dissolves boards of Union, Keystone, Polaris Banks

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The Central Bank of Nigeria (CBN) has announced the dissolution of the boards of directors of three major banks – Polaris Bank, Union Bank, and Keystone Bank.

President Bola Tinubu appointed Jim Obazee as a Special Investigator in July 2023, and his comprehensive investigation into the Central Bank of Nigeria and related entities is believed to have prompted the decision to dissolve the boards.

In a statement on Monday, the CBN alleged that the banks in question had engaged in serious infractions, including non-adherence to regulatory requirements, corporate governance failures, and other violations, leading to the dissolution of their boards.

In a press statement by its spokesperson, Sidi Hakama, CBN said: “This action became necessary due to the non-compliance of these banks and their respective boards with the provisions of Section 12(c), (f, (g), and (h) of the Banks and Other Financial Institutions Act, 2020.”

According to a report submitted to Tinubu on December 20, Obazee alleged that former CBN Governor Godwin Emefiele utilized illicitly acquired funds to establish TTB, which was then used to acquire Union Bank and Keystone Bank through proxy individuals.

Obazee recommended that the federal government should seize the banks after his investigation revealed suspicious ownership structures and loans connected to Emefiele.

Tropical General Investment Group (TGI) has responded to allegations by stating that the $500 million used to acquire Union Bank was sourced “transparently and legitimately” and that the acquisition process was conducted in accordance with all relevant regulations and legal requirements, emphasizing the integrity and propriety of the transaction.

TGI said: “The entire transaction was managed by highly reputed global financial institutions, including Rothschild and Citibank.

“A USD 300 million loan was sourced from African Export-Import Bank (Afrexim), and the rest of the capital was sourced from the proceeds of TGI’s sales of its Chi Ltd. business to Coca-Cola, all to finance the acquisition of Union Bank.”

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