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   Market Date: 29-08-2014   
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Shareholders petition N18b scam in Wema Bank

Category: Capital Market


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Shareholders petition N18b scam in Wema Bank The Economic and Financial Crimes Commission (EFCC) has begun investigations into how the sum of N18 billion insider- related credits was allegedly written off by management of Wema Bank. Sources said immediate past Managing Director of the bank, Alhaji Alade Musiliu Adeleke, was invited and questioned over the allegations last week. The EFCC, Daily Independent gathered, acted on the strength of a petition written to both the Central Bank of Nigeria (CBN) and the anti-corruption watchdog by some aggrieved shareholders of the bank. The EFCC confirmed interrogating Adeleke who replaced Mr. Babatunde Lemo, when he was appointed Deputy Governor, Financial Services Surveillance (FSS) of the CBN in December 2003. Until his appointment as CEO, Adeleke had been Executive Director, Information Technology and Operations since March 2001. Though the aggrieved shareholders were said to be seeking the intervention of the Governor of the CBN, Prof. Charles Soludo, to compel Lemo to explain all he knows about the said bad loans, the apex bank said there was no truth to the allegations. The Economic and Financial Crimes Commission (EFCC) has begun investigations into how the sum of N18 billion insider- related credits was allegedly written off by management of Wema Bank. Sources said immediate past Managing Director of the bank, Alhaji Alade Musiliu Adeleke, was invited and questioned over the allegations last week. The EFCC, Daily Independent gathered, acted on the strength of a petition written to both the Central Bank of Nigeria (CBN) and the anti-corruption watchdog by some aggrieved shareholders of the bank. The EFCC confirmed interrogating Adeleke who replaced Mr. Babatunde Lemo, when he was appointed Deputy Governor, Financial Services Surveillance (FSS) of the CBN in December 2003. Until his appointment as CEO, Adeleke had been Executive Director, Information Technology and Operations since March 2001. Though the aggrieved shareholders were said to be seeking the intervention of the Governor of the CBN, Prof. Charles Soludo, to compel Lemo to explain all he knows about the said bad loans, the apex bank said there was no truth to the allegations. CBN spokesman, Festus Odoko, denied knowledge of any such petition, describing it as a mere “rumour.” According to him, “I have not heard anything like that.” Though sources said Adeleke was replaced mid-week as Managing Director and Chief Executive Officer of the 60-year old Wema Bank in what sources close to the bank said was an attempt to minimize the impact of the allegations on the effort to consolidate. The source added that the petitions bordered on accumulated bad credit facilities allegedly extended by the bank over the years by Adeleke and his immediate predecessors. The bad loans, which are later provisioned for and written off as “bad and doubtful,” are believed to have seriously hampered the growth, development and competitiveness of the bank. The internal wrangling arising from questions about the propriety of writing off such huge funds was said to have led to the inconclusive annual general meeting in Port Harcourt, River State some months ago. The meeting was, however, rescheduled for Excellence Hotel, Ogba, Lagos last week. That meeting ratified the resignation of Adeleke, who had been on suspension before then. Officials of the bank had refuted claims of wrongdoing and argued instead that Adeleke was undertaking a “rest on health grounds.” The board last week named Bisi Omoyeni, Ekiti State Deputy Governor as Adeleke’s replacement. Omoyeni, a top banker and former Executive Director at Wema Bank, was named Deputy Governor after the impeachment of the former occupant earlier in the year. An official of the bank, when contacted on Friday about Adeleke’s interrogation by the economic crimes watchdog simply told Daily Independent, “it is not true.” The CBN reportedly granted an Approval-In-Principle (AIP) for Wema Bank Plc take over Leadbank and Nationalbank of Nigeria Limited, under the ongoing banking consolidation exercise, just as the shareholders at the reconvened AGM adopted by unanimous resolution the exchange ratio of seven ordinary shares of National Bank for two of Wema’s. The emergent Wema Bank is expected to have a shareholders’ fund pool of N28.2 billion, total asset base of N127.74 billion, 143 branches spread across 27 states of the federation and staff strength of 2,356. Source Daily Independent

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