Microfinance bank sues CBN, NDIC over alleged unlawful license revocation

October 16th, 2018
By Raphael Izokpu 
BFL Microfinance bank limited has sued the Central Bank of Nigeria (CBN) Governor, Godwin Emefiele; the CBN as an institution and the Nigeria Deposit Insurance Corporation, NDIC for unlawful revocation of its license on the ground of insolvency.
The legal Representative of BFL Microfinance bank, David Asha-Olu made this known to newsmen during a press briefing weekend in Abuja.
He said: On Wednesday the 10th of October 2018, some people came to BFL microfinance bank limited and pasted a notice, in which they claimed that BFL microfinance bank Limited license has been revoked on the ground of insolvency.
Asha-Olu who expressed disappointment over the injustice meted against BFL Microfinance bank, said that CBN governor cannot revoke the license of a bank just because he thinks that a bank is insolvent.
“A regulator who has not gotten to an organisation cannot declare the organisation insolvent, it doesn’t happen that way, “I cannot just come and say you are bankrupt, it doesn’t make sense,” he noted. 
“If a bank is really insolvent, it is the bank that will inform the CBN governor or the CBN generally that we are insolvent please come and manage us, and what the CBN does in that situation is to appoint NDIC to run that bank for some time to see how they can make the bank work again.
“In that process, they thereby recapitalise the bank for a few days or weeks and even years as the case may be, and if it doesn’t work, the NDIC will write a report to the CBN governor and say this bank cannot be rehabilitated please revoke their license,” he said. 
Asha-Olu said that Velma solicitors who is the legal adviser to BFL microfinance bank limited has already filed a suit in court and vowed to see to the end, even if it will take one hundred years to get justice while assuring its customers that they will bounce back for operation in a few weeks to come. 
“That is why we are here, to ensure that this injustice does not happen, BFL had a new manager in 2017 and between then and now, the Bank had raised their customers’ base to 2,000.
He said: “BFL is located in a plaza with many of the neighbours as customers. It is also one of the very few microfinance banks in Nigeria that offers loans without collateral. In the last one year of its operation the Bank issued more than 500 loans while the customers have been paying back the money.”
According to the legal adviser, “If the CBN got wrong information about BFL microfinance bank, one would have expect them to invite BFL and say ‘this is what we heard about you, defend yourself’. A regulator cannot just wake up based on the information they heard and declare a bank insolvent,” he said.
He, however, said that a bank is insolvent if customers come around to ask for their money and the bank does not have money to pay them.
“I have not seen anybody here creating problems that we cannot pay them or we are running, had they seen that people were queuing asking for their money, that would have justified their action, “but instead when they came, they saw us trying to pay a customer and they stopped us, saying the customer should come and collect the money from them times two. What are they trying to do, are they trying to close down our business with cheap political reasons, is it because the chairman of BFL is PDP governorship candidate in a state, is that why APC government is doing this to us, we must make sure we fight this thing to the last point,” he noted.
Some customers of BFL microfinance bank said, they were shocked to hear about the sad story of its license revocation.
Meanwhile, they expressed satisfaction in the operation of the microfinance bank. 
One of such customers, Mrs Veronica Ugan said, “l was shocked to hear about the closure of the bank. As a neighbour, l have been banking with BFL Microfinance Bank for over eight years now and anytime l had any little money as a trader l ran there to save with them and anytime I need money, I always got it without any issue.” She, however, pleaded with federal government not to close down the bank.
Another customer, Mr Fidelis Adetu faulted the act, as he expressed satisfaction with the bank, saying since he started banking with them about six years now, he had never had any issue with the bank. 
“l even withdrew some money from my account with the microfinance bank earlier in the week for my company. I see it as unfair for CBN to revoke the license of BFL microfinance bank, as they are really helping small scale businesses like us who are not able to get loan without collateral from the commercial banks,” he said.
Similar Post You May Like read more
Just In read more