The House of Representatives yesterday resolved to investigate the Central Bank of Nigeria, (CBN), for withdrawing the operating license of Savannah Bank Plc.
The law makers said also they would launch an inquiry into to ascertain the roles played by the Nigerian Deposit Insurance Corporation, (NDIC ) which took over as liquidator of the bank, leading to the sealing off of its branches across the country.
The review of the Savannah Bank matter is coming about seventeen years after the two regulators sealed the fate of the bank owned largely by Chief Jim Nwobodo, a former governor of old Anambra State.
Members of the House reached the decision on the heels of a motion captioned “Need to Investigate the Central Bank of Nigeria and the Nigerian Deposit Insurance Corporation on the Current Status of Savannah Bank”, moved by Magaji Da’u Aliyu. The CBN had withdrawn the operating licence of Savannah Bank Plc on 15 February 2002 on the ground that it did not have enough assets to meet its current liabilities, did not also comply with apex bank obligations in addition to the failure of its promoter to recapitalise it to prevent further deterioration of its assets. But the bank later challenged its closure in court and in a ruling on October 20, 2006, the High Court of the Federal Capital Territory, Abuja held that the CBN had acted properly in revoking the bank’s licence. Subsequently, the Court of Appeal in a ruling on February 6, 2009 ordered the re-opening of the bank and further directed the CBN and the NDIC to pay N100 million to the bank as damages. Leading the debate, the lawmaker said “The House is aware that history was made in the Nigerian banking industry when in line with the order of the court, the licence was restored thus putting an end to seven years of agony for directors, depositors and other stakeholders of the bank; “Further aware that seventeen years after Savannah Bank’s licence was restored, the bank is yet to commence operations; “Again aware that at the time of its forceful closure, the bank had nearly 85,000 shareholders, share capital of N1 billion and about 118 branches with depositors funds who were in hundreds of millions; “Concerned that most of the depositors whose funds were trapped in the bank for the last 17 years are either dead, bankrupt or in dire hardships after many years of depression and discontentment”.