A Nigerian businessman and former Chairman of the defunct City Express Bank, Prince (Dr.) Samuel Adedoyin, has debunked the false and defamatory publication made by the Nigeria Deposit Insurance Corporation (NDIC). The publication, titled “Failure of City Express Bank”, was published on their website.
Reacting through a letter written by his solicitor, Barrister Tunde Akinrimisi, to the debt recovery agency, he rejected and refuted what he termed a biased and defamatory report, with the Corporation failing to take full responsibility for its lapses as a regulatory body.
“The inaccurate, incomplete, and biased publication, which remains on the NDIC’s website, does not give an account of events that transpired since the takeover of the defunct bank. On the other hand, recent occurrences and revelations that have surfaced have fundamentally faulted the unproven allegations stated in the said publication.
The publication, which inaccurately recounts NDIC’s position, has not been updated to include cases that have been determined by the Federal High Court. No reference was made to Suit No: FHC/L/CS/87/2006, in which the Court struck out NDIC’s unproven claims of debt against Dr. Adedoyin and his companies.
The report also does not make reference to Suit No: FHC/L/CS/1690/2017, where the Federal High Court found that NDIC did not file the requisite annual returns, prevented NDIC from making further sales of assets of the defunct bank pending compliance, and directed NDIC to give a comprehensive account of the assets of the defunct bank and the status of each asset—all of which have not been done to date.
On the contrary, NDIC, in flagrant disobedience of the subsisting order of the Court, has continued to dispose of or give notice for the disposal of the assets and property of the defunct bank.
The business mogul debunked the unproven and biased allegation that the management of the defunct City Express Bank engaged in financial misreporting and under-provision for the deterioration of its risk assets portfolio.
Contrary to these allegations, Prince Adedoyin stated that NDIC and the Central Bank of Nigeria (CBN), as regulatory bodies, conducted regular and periodic routine examinations of the defunct bank, and none of the said examination reports alleged recklessness, fraud, or misreporting as now erroneously and unjustifiably portrayed by NDIC in its report.
“If there was misreporting or manipulation of prudential returns filed, as erroneously alleged, and the same was not detected during the various periodic examination exercises conducted by both NDIC and CBN, then that would ordinarily suggest that officials of the regulatory authorities participated in the alleged and unproven collusion, or that the said officials were fundamentally incompetent in the discharge of their duties as inspectors or examiners.
NDIC, as a regulator, must accept its fair share of the blame for the collapse of banks in Nigeria, including the defunct bank, and not put forward a one-sided report portraying the Corporation as competent while laying blame on the management of the defunct bank to protect its image.”
Under paragraph 2.1 (Ownership, Board, and Management) of the report, NDIC asserts that the defunct bank was operated by a nuclear family through its 94 percent interest, which was allegedly deployed to the detriment of the defunct bank.
The defunct City Express Bank was incorporated on the 2nd day of November, 1988, as Industrial Bank Limited (Merchant Bankers) under the Companies Act 1968, now the Companies and Allied Matters Act 2020, as a private company limited by shares with RC No: 120141.
The name of the bank was changed to City Express Bank Limited and subsequently to City Express Bank PLC.
NDIC has repeatedly made heavy weather of the ownership structure of the defunct bank, despite the fact that CBN approved and registered the said bank to operate as a bank in Nigeria and was fully aware of its ownership structure prior to granting the said approval, which was at no point revoked by CBN. Without the approval of the CBN, no bank in Nigeria can operate.
If there was any irregularity arising from the ownership structure or composition of the Board of the defunct bank, then both CBN and NDIC cannot avoid culpability, having approved the same or failed to exercise their respective regulatory authority to prevent the bank from operating.
At the time of setting up the defunct bank, it was neither irregular nor illegal for members of the same family to be on the board of a bank or cumulatively hold majority shares in the bank. If it is now being put forward that the practice was wrong, then NDIC and CBN cannot avoid responsibility for allowing the continuation of the said irregularity over the years and under their respective watch.
Consequently, making an issue of the ownership structure of the bank as a reason for the failure of the defunct City Express Bank is a lame and insupportable excuse.
“The point being made herein above is that there is clear bias and witch-hunt against Dr. Adedoyin and the erstwhile Managing Director of the defunct bank, who have been singled out for persecution.”
It was also alleged that there was poor corporate governance throughout the existence of the defunct bank and that the small size of the board hindered oversight of major activities.
“The report further highlighted the issue of the chairmanship of the Board Credit Committee (BCC) of the defunct bank and stated that Adedoyin, as the Board Chairman, violated CBN’s directive not to chair the BCC.
This response acknowledges the fact that the issue of the chairmanship of the BCC was raised in the 2004 NDIC routine examination report but states that it was immediately corrected, contrary to the wrong impression put forward in the report. A report of this magnitude ought to accurately present and disclose facts.
The report exaggerated the impact of the erstwhile chairman of the defunct bank’s headship of the BCC without specifically stating what wrong he committed in such capacity regarding loan approvals or how his chairmanship of the BCC resulted in the collapse of the defunct bank.”
“Sequel to the case in Suit No: FHC/L/CS/87/2006, where the Court struck out NDIC’s case against our client for failure to prove the alleged debt of ₦2.3 billion erroneously paraded to the public, our client’s representatives have had several meetings with NDIC and sought clear evidence as to how the debit balances arrived at were reflected. Despite NDIC officials in the settlement meetings agreeing to produce the same, they have failed to do so to date, showing unquestionably that NDIC has still not been able to justify the spurious figures portrayed as debts linked to our client and companies related to him.
The report NDIC has relied on over the years is untrue, manipulated, doctored, and false, and it is currently the subject of an ongoing investigation at the Office of the Attorney General of the Federation, following a complaint made thereto by Dr. Adedoyin.
Despite the ongoing investigation and even damaging in-house revelations, NDIC has not deemed it appropriate to take down the now heavily discredited report, even though there seems to be irrefutable evidence of serious malpractices committed in arriving at the said figures tied to our client and related companies.
A report meant for the attention of the public must be unbiased, fair, and credible.
In the final analysis, our client submits that the report under review is biased, unfair, incomplete, and non-credible. The damaging insider report is so fundamental, with NDIC having major questions to answer.
The NDIC report was considered one-sided, selective, and inaccurate, written to portray Dr. (Prince) Samuel Adedoyin in a very bad light in the eyes of the public.
Accordingly, the solicitor is demanding that the report addressed herein be taken down on the basis of fairness and proper accountability to the general public.
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