The crisis between African Petroleum Plc and Access Bank over the $35 million loan deepened at the weekend as the Central Bank of Nigeria (CBN) absolved Access Bank of allegations of violating regulatory laws on foreign exchange dealings with AP.
The CBN in a letter dated July 24 with reference number BSD/DIR/CON/APP/01/025, addressed to the AP managing director signed by the bank’s director of banking supervision, Samuel Oni stated that it was not aware of any violation of any regulatory laws on foreign exchange by Access Bank since foreign exchange for the stipulated transaction was not sourced from the CBN.
AP had petitioned CBN on May 15, 2009 over an alleged foul play by Access Bank on the repayment of the $35 million loan facility at N127 per dollar instead of the N116.62 per dollar when the transaction was consummated two years ago.
But the CBN has said in its response that Access Bank had not violated any law.
“The following facts emerged from Access Bank’s response to your petition made pursuant to our letter of 2nd June, 2009 to the bank and our findings of facts elicited from our records of transactions during the period, that your company AP vide letter dated 24 June 2008, instructed Access Bank to establish an irrevocable letter of credit on her behalf in the sum of $38,937,000,00 in favour of Glencore Energy UK limited (supplier) for a tenor of 180 days using its $50 million trade finance line”
“On 25th July 2008, an LC was opened on your behalf in favour of Glencore which LC was due for payment on 30th November 2008. On 12th November 2008, Access Bank advised your company to provide Naira cover for the sum of $35,153,822 to enable it purchase foreign exchange for the repayment of its obligation to its correspondent bank. Access Bank addressed another letter dated 24th November 2008 to your company for the said Naira equivalent of the 35,153,822.00 which request was rejected by your company. As of the date of the transaction (December 2008), the foreign exchange regime in operation was the WDAS, which allowed banks to buy foreign exchange in their accounts for trading.
That Access Bank offered to sell foreign exchange to your company at the rate of N127/$ to cover its outstanding and unpaid facility-exposure of $35,153,822.15 in line with the bank’s offer letter which clearly stated it would not be responsible for any foreign exchange risk.
Access Bank proceeded to debit your company’s current account vide its letter of 2nd December 2008 which debit was rejected by your company.
Arising from the above, Access Bank subsequently reversed the debit entry in your favour”.
The CBN however said records of transactions during the relevant period revealed that Access Bank did not source foreign exchange from the CBN for the LC transaction in dispute and CBN was not aware of any violation of any regulatory laws on foreign exchange by the bank since the foreign exchange for the disputed transaction was not sourced from the CBN.
However, the Chief Operating Officer of AP, Tunde Falasinu told Daily Trust yesterday that he had not received the CBN response to his letter, saying that since AP opened Form M and letter of credit, the bank ought to have used that to bid for FOREX in the market.