N5.87b Fine: CBN Reviews New Evidence From Banks, MTN

[Edoman]

Posted By: Collins Nweze



The Central Bank of Nigeria (CBN) is reviewing new evidence from four banks and MTN Nigeria over the sanctions slammed on them by the regulator, it was learnt yesterday.

The banks – Standard Chartered Bank, Stanbic-IBTC, Citibank and Diamond Bank – were last month fined N5.87 billion by the apex bank for breach of capital importation policy.

The CBN had accused the banks of remitting foreign exchange with irregular Certificates of Capital Importation (CCIs) issued on behalf of some offshore investors of MTN Nigeria Communications Limited. The banks and MTN Nigeria have denied any wrongdoing.

According to the CBN, the lenders were asked to refund $8,134,312,397.63 for what it described as ‘flagrant violation of extant laws and regulations of the country, including the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act, 1995 of the Federal Republic of Nigeria and the Foreign Exchange Manual, 2006’.

In a statement yesterday, CBN Director, Corporate Communications, Isaac Okorafor, said: “In response to the recent regulatory actions, the banks and MTN are engaging the CBN and have provided additional information which is currently being reviewed with a view to arriving at an equitable resolution.

“We assure all investors that the integrity of the CCI regime remains sacrosanct and there shall be no retroactive application of foreign exchange rules and regulations.”

The regulator also defended its N5.87 billion fine on the banks over alleged capital importation breaches on $8.1 billion transactions involving MTN Nigeria. The apex bank has insisted that the sanctions will not deter foreign investors from coming to invest in Nigeria.

Okorafor, said the apex bank acknowledges the public interest over sanctions recently imposed on four deposit money banks (DMBs). The apex bank said it welcomes all legitimate investors to take advantage of the enormous investment opportunities in Nigeria.

“We wish to restate that the CBN will continue to welcome foreign investments and investors. Indeed, some of our recent innovations and reforms of the Foreign Exchange regime such as the introduction of the Nigerian Autonomous Foreign Exchange (NAFEX) window are designed to simplify foreign exchange regulations.

“Furthermore, the delegation of the issuance of Certificates of Capital Importation (CCIs) to commercial and merchant banks some years ago was done to instill confidence in the investor community and encourage the flow of foreign direct and portfolio investments into the Nigerian economy.

The sanctions on the banks arose due to irregularities with respect to repatriations made on behalf of MTN Nigeria Limited and were not in any way designed to restrict access to investor returns.

“In response to the recent regulatory actions, the banks and MTN are engaging the CBN and have provided additional information which is currently being reviewed with a view to arriving at an equitable resolution.

“We assure all investors that the integrity of the CCI regime remains sacrosanct and there shall be no retroactive application of foreign exchange rules and regulations”.

http://thenationonlineng.net/n5-87b-fine...banks-mtn/

[Edoman]

MTN Shares Rise 8.9 Per Cent On Planned CBN Meeting Over $8.1b Claim


MTN shares rose by 8.9 per cent on the Johannesburg Stock Exchange, South Africa, yesterday, following Central Bank of Nigeria (CBN)’s resolve to meet with the telecommunications firm and the indicted banks over the $8.1 billion repatriation fund saga.

The rise in shares is MTN’s biggest in the last six months, but the stock is still down 28 per cent since the $8.1 billion claim was made on August 29, wiping out almost $5 billion of market value.

The CBN said yesterday that it had agreed to negotiations proposed by MTN Nigeria and the four banks involved in the $8.13 billion transfers, which certificate of capital importations were adjudged fraudulent.
It also said the engagement was sequel to the provision of additional information, which is currently being reviewed with a view to arriving at an equitable resolution.
Director of Corporate Communications Department, CBN, Isaac Okorafor, who disclosed this, said the apex bank acknowledged the public interest over the sanctions recently imposed on four deposit money banks (DMBs), but wished to restate that it would continue to welcome foreign investments and investors.
According to Bloomberg, the announcement suggests there may be a way for Johannesburg-based MTN to reach a deal with Nigeria, just as it did two years ago when it negotiated a $5.2 billion fine to about $1 billion and a commitment to list its local business in Lagos.
That penalty was related to subscribers that were not properly registered in the country.
A London-based analyst at Signal Risk, Ronak Gopaldas, who was quoted by Bloomberg, said: “This is a welcome development and cements our initial view that the sanction was unsustainable.
“Considerable damage has already been done in terms of brand damage to Nigeria Inc. and value erosion for MTN. However, a more conciliatory tone will see some of these losses being reversed. It will help calm investors.”
The Apex bank’s statement did not refer to $2 billion of taxes MTN is also accused of owing, a claim that comes from the Attorney General’s office.
Reacting to the development, President, Association of Telecommunications Companies of Nigeria (ATCON), Olusola Teniola, said: “While this is a step in the right direction, continued dialogue to reach an amicable resolution is a minimum standard expected by the investment community.”
Already, MTN has gone to the Federal High Court to seek redress on the matter.
MTN Group CEO, Rob Shuter, at the just concluded International Telecommunications Union (ITU) Telecoms World in Durban, South Africa, described as a disagreement between the telecommunications firm and the Nigerian authority with a promise to resolve the matter amicably.

http://www.akelicious.net/2018/09/mtn-shares-rise-89-per-cent-on-planned.html