According to the CBN, the decision was made in accordance with its mandate to promote a sound financial system in Nigeria and in exercise of its powers under Section 12 of the Banks and Other Financial Act (BOFIA) 2020. The bank's breach of Section 12 (1) of BOFIA, 2020, which requires banks to maintain a minimum capital adequacy ratio, among other financial requirements, led to the revocation.
The CBN stated that despite its engagement with the bank and the prescription of various supervisory steps to address the decline, the bank's financial performance continued to deteriorate, leaving no reasonable prospects of recovery. The revocation of the licence was therefore deemed necessary to strengthen public confidence in the banking system and ensure the soundness of the financial system.
The Nigeria Deposit Insurance Corporation (NDIC) has been appointed as the Liquidator of the bank, in accordance with Section 12 (2) of BOFIA, 2020. The CBN assured the public that the Nigerian financial system remains on a solid footing and that the action taken against Heritage Bank reflects its continued commitment to ensuring the safety and soundness of the financial system.
This development marks a significant move by the CBN to maintain the stability of the banking sector and protect depositors' funds. The revocation of Heritage Bank's licence is a reminder of the CBN's zero-tolerance stance on financial instability and its commitment to upholding the integrity of the financial system.
