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CBN under probe for $7 billion bail out

by CredibleNews

The House of Representatives has opened investigations into the $7 billion withdrawn from the foreign reserves by the Central Bank of Nigeria, CBN, in 2006 to pay banks and assets managers. The bail out has not been refunded.

The House has mandated its Committee on Banking and Currency to investigate “the details of the disbursed funds by the CBN to the banks and the continued non-repayment of same 13 years after disbursement.”

The committee is also to determine “the terms and conditions of the disbursement to ascertain if they have been complied with as it relates to repayment of the fund, and report back within eight weeks for further legislative action.”

The lawmakers had adopted a motion titled: ‘Need to Investigate the Non-Repayment of $7bn from Nigeria’s Foreign Reserves Disbursed to 14 Global Asset Managers and 14 Nigerian Banks by the Central Bank of Nigeria since 2006.’

Hon. Abubakar Ahmad, who moved the motion, recalled that sometime in 2006, the CBN disbursed $7 billion of Nigeria’s $38.07bn foreign reserves to 14 global asset managers and their 14 banks to manage.

“The House is aware that the CBN gave each asset manager and its Nigerian bank counterpart $500m from the nation’s foreign reserves to manage. The 14 banks that received the said funds, about six of them, namely Oceanic Bank, Intercontinental Bank, Bank PHB, FIN Bank, AfriBank, and very recently Diamond Bank Plc were merged/acquired by other banks under the oversight of the CBN.

“The House is again aware that the assets and liabilities of the six merged/acquired banks have been legally acquired as part of the legacies of the defunct banks. After 13 years, Nigeria’s hard-earned $7bn foreign reserve has not been repaid to the CBN and there is no action put in place to ensure repayment of the funds,” the motion read.

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