A combined photo of Prince Samuel Adedoyin and NDIC logo
By Toyin Williams
Nigeria businessman and former Chairman of the defunct City Express bank, Prince (Dr) Samuel Adedoyin has debunked false and defamatory publication made by Nigeria Deposit Insurance Corporation, NDIC. In the publication titled ‘Failure of City Express Bank’’
Reacting through his solicitor A.O. Akinrimisi of Fagrame Firm of Barristers and Solicitors, the reaction was rejected and refuted what was termed as biased and defamatory report published on NDIC’s website with the Corporation failing to take full responsibility of its lapses as a regulatory body.
‘’The inaccurate, incomplete and biased publication which remains on the NDIC’s website does not give an update of events that has occurred/transpired since the takeover of the defunct bank on the one hand and recent occurrences and revelations that has surfaced which has fundamentally cast doubt as to 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. The publication makes no reference to SUIT NO: FHC/L/CS/87/2006 wherein the Court struck out NDIC’s unproven claims of debt against our Client and companies tied to him.
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 sale of assets of the defunct bank pending when same is done and also, directing NDIC to give a comprehensive state of affairs of the assets of the defunct bank and the status of each asset. All of which has not been done till date.
On the contrary, NDIC in flagrant disobedience of the pending Order of Court has continued to dispose/give notice for disposal of the assets/property of the defunct bank’’ it was stated.
According to the report made available to us, Prince Adedoyin debunked the unproven and biased allegation that the management of the defunct City Express Bank engaged in financial misreporting and also vehemently debunked the allegation in the report that the defunct bank under-provided for deterioration of its risk assets portfolio.
Contrary to the above, Prince Adedoyin, stated that NDIC and Central Bank of Nigeria, CBN as regulatory bodies conducted regular/periodic routine examinations in the defunct bank and none of the said examination reports alleged recklessness, fraud or misreporting as now erroneously and unjustifiably portrayed by NDIC in the Report.
‘’If there was misreporting or manipulation of prudential returns filed as erroneously alleged and same was not detected during the various periodic examination exercise 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/examiners.
Whichever side of the coin we look at, 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 and laying blame on the management of the defunct bank to protect its image’’ Chief Adedoyin added.
Under paragraph 2.1 (Ownership, Board and Management) of the Report, NDIC assert 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 Report also alleges that the defunct bank disregarded Corporate Governance and engaged in insider trading.
Reacting to the allegation above , it was affirmed that The defunct City Express Bank was incorporated on the 2nd day of November, 1998 as Industrial Bank Limited (Merchant Bankers) under the Companies Act 1968 now 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 on the ownership structure of the defunct bank despite the fact that CBN approved and registered the said defunct bank to operate as a bank in Nigeria and was fully aware of the ownership structure of the defunct bank prior to granting the said approval and which said approval was at no point in time revoked by CBN. Without approval of the CBN, no bank in Nigeria can operate.
Consequently, CBN approved the defunct bank’s ownership structure and granted the defunct bank license to operate as a commercial bank based on the said ownership structure now complained of.
It is important to also state that NDIC was not ignorant of the ownership structure of the defunct bank as the bank’s ownership structure was repeatedly reflected in various NDIC examination reports.
‘’Flowing from the above, 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 same or did not exercise their respective regulatory authority to prevent the bank from operating. This was never done.
As 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 having majority shares in the bank. If it is now put forward that the practice was wrong, then NDIC and CBN cannot avoid responsibility in allowing continuance of the said irregularity over the years and under their respective watch.
Consequently, making an issue on the ownership structure of the bank as a reason for the failure of the defunct City Express Bank is a lame and insupportable excuse put forward as a reason for the failure of the defunct City Express Bank. This excuse cannot in any away or manner justify the Corporation’s negligence or culpability.
Interestingly, the biased Report chose to single out two Directors of the defunct bank for the alleged, and I must say unproven misconduct of the Board.
It is trite that the decision of the Board is a collective responsibility of the entire Board, and not of two persons where there is no evidence that decisions were taken without bank Board meetings, or that other Board members were not in agreement with decisions made or that the said decisions of the Board only became effective by manner of vote by number of share holdings.
The point being made herein above is that there is clear bias and witch hunt against our Client and the erstwhile Managing Director of the defunct bank who have been singled out for persecution’’ It was avowed.
It was also allege poor corporate governance throughout the existence of the defunct bank and also suggests that the small size of the board was a hindrance to overseeing major activities of the defunct bank.
‘’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 Board Credit Committee (BCC) was raised in the 2004 NDIC routine Examination Report but states that same 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 Board Credit Committee without specifically stating what wrong he committed in such capacity regarding approval of loans or how his chairmanship of the Board Credit Committee (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 2.3billion naira erroneously paraded to the public, our Client’s representatives have had several meetings with NDIC and sought NDIC to produce clear evidence as to how the debit balances arrived at were reflected and despite officials of NDIC in the settlement meeting agreeing to produce same, they have failed to do so till date showing unquestionably that NDIC have still not been able to justify the spurious figures portrayed as debts linked to our Client’s company and companies related to our Client.
It is now without any doubt that the report NDIC has relied on over the years are untrue, manipulated, doctored and false and it is currently subject of ongoing investigation at the office of the Attorney General of the Federation following a complaint made thereto by Adedoyin.
Despite the ongoing investigation and even a damaging in house revelation, NDIC has not deem it appropriate to take down the now heavily discredited report even though there seems to be irrefutable evidence of serious malpractices that were committed in arriving at the said figures tied to our Client and related companies.
NDIC should in honesty consider the counter report made by an insider which said report has put into question and negated virtually every finding of the Corporation of and concerning our Client on the one hand and the defunct bank on the other hand.
A report for the attention of the public must be unbiased, fair and credible.
In the final analysis, our Client submits that the Report under review in this reaction 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 therefore considered one sided, and written to portray our Adedoyin in very bad light in the eye of the public. An incomplete report which is selective in details is an inaccurate report which should not remain on the NDIC website which is a public domain.
“It should be noted that NDIC has lost its vision of securing Nigerian Banks and turn itself into the duty of an “undertaker” Adedoyin added.
Accordingly, the solicitor respectfully demand that the report addressed herein be taken down on basis of fairness and proper accountability to the general public.
