BY
MATTHEW OKPARA
Abstract
Obtaining a banking licence in Nigeria is not a walk-in-the-park activity. The Banks and Financial Institutions Act (Repeal and Re-enactment), 2020 in section 3 enumerated the requirements to be fulfilled by those who desire to be licensed to offer banking services and these requirements are laced with enormous difficulty and hardship. What is more? The Banks and Other Financial Institutions Act, in section 3(3), bestowed on the Central Bank of Nigeria and her governor the unfettered and unquestioned discretion to grant or not to grant this licence, without giving reasons, even after the conditions stipulated for its grant has been satisfied. So, even a rumor of the revocation of this hard-to-get banking licence sinks the heart of interested stakeholders in fear. The interested stakeholders include the ocean of depositors and customers of the bank who maintains financial relationship with the bank and who are at the risk of not having access to their monies for a long time or forever; shareholders and investors who must have invested heavily in the banking business; and the numerous employees who are at the verge of being sent back to the overflowing and unfavorable labour market. Thus, it is reasonably expected that a bank whose licence has been revoked should engage all those involved—ranging from the Central Bank of Nigeria who revoked the licence, to the Nigeria Deposit Insurance Corporation who are appointed as liquidators of the revoked bank, to even the Inspector General of Police who was assigned the duty of ensuring the continued closure of all the branches of the bank across the country— in a legal battle. When two elephants fight, the grasses suffer. In the process of this extended legal war, depositors, customers, former employees, among others, bear the brunt of this battle. Putting all these into consideration, there are necessary questions which the researcher will attempt to answer. First, is the CBN governor restricted from pressing the revocation button arbitrarily? Can revocation of banking licence be used as a tool of get-back and retaliation? In 2002, when the licence of Savannah Bank PLC was revoked, it was rumored that underlying the revocation is the desire of then president of Nigeria, Chief Olusegun Obasanjo to get back at a major shareholder in the bank, Senator Jim Nwobodo. Even after a licence has been revoked, can an aggrieved bank run to the temple of justice unrestricted, without meeting any obstacle barricading the entrance to the temple? Even when the temple has been entered successfully and the ministers of the temple submits the aggrieved bank’s petitions to the goddess of justice, what remedies will the impartial and unbiased goddess grant? If by mercy, the goddess orders for the restoration of the banking licence, would life remain the same and would the world still be standing at the pre-injury position?