Despite Assurances, Investors Whip Diamond Bank, Stanbic IBTC, Over N5.65bn CBN Fines

The managements of Stanbic IBTC Holdings and Diamond Bank, as part of their post-listing requirements formally informed the Nigerian Stock Exchange (NSE) of the penalties imposed on them by the Central Bank of Nigeria (CBN) their primary regulator, over alleged illegal repatriation of $8.13bn outside of the country on behalf of MTN Communications Nigeria, their client.
The assurances by both companies within minutes of the market’s opening seemed to have been ignored, as Diamond Bank lost 9.35% of its opening price, much more than the 6.92% it garnered on Wednesday; while Stanbic IBTC suffered a marginal 1.25% cut. Also, 17.203m units of Diamond Bank were traded
The penalties, totaling N5.65bn, was imposed on Stanbic IBTC, Diamond Bank, Standard Chartered Bank and Citibank, the CBN said in a statement on Wednesday, followed investigation for repatriating the foreign exchange, using “irregular” Certificates of Capital Importation (CCIs). A breakdown of the amount showed that while Standard Chartered was fined N2.4bn; Stanbic IBTC is to pay N1.8bn; followed by Citibank’s N1.2bn; and Diamond Bank, N250m.
Stanbic IBTC assured that its management “is holding further engagements with the CBN in relation to the issues it has raised.”
The statement, signed by Chidi Okezie, its Company Secretary, Stanbic IBTC Holdings assured the capital market community that the issue does not impact the ordinary conduct of its business and corporate transactions.
On its part, Diamond Bank assured stakeholders that it “complies with all regulatory policies issued” and that it continues to cooperate with the investigation.
Contrary to the CBN’s statement that the infraction occurred between 2007 and 2015, Diamond Bank in the statement by Uzoma Uja, its company secretary also, said the transaction under reference “occurred between 2001 and 2006.
He also assured that “the development does not impact you ability to continue to do business with the bank” and that it is cooperating with the CBN to resolve the matter.