The Central Bank of Nigeria (CBN) has revoked the operating licences of Aso Savings and Loans Plc and Union Homes Savings and Loans Plc for alleged persistent regulatory infractions and deteriorating financial conditions of the two primary mortgage banks.
The apex bank in a statement issued on Tuesday by its Acting Director, Communications Department, Mrs. Hakama Sidi Ali, maintained that the decision was taken in line with Section 12 of the Banks and Other Financial Institutions Act (BOFIA) 2020 and Section 7.3 of the Revised Guidelines for Mortgage Banks in Nigeria.
According to the CBN, the action forms part of its efforts to reposition the mortgage sub-sector and promote strict compliance with relevant laws and regulations.
It clarified: “The affected institutions violated various provisions of BOFIA 2020 and the Revised Guidelines for Mortgage Banks in Nigeria.”
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Specifically, the apex bank listed the affected mortgage banks’ statutory violations as including failure to meet the minimum paid-up share capital requirement for their licensed category; insufficient assets to meet liabilities; critical under-capitalisation with capital adequacy ratios below the prudential minimum prescribed by the CBN; and failure to comply with several directives and obligations imposed by the regulator.
The CBN reaffirmed its commitment to its statutory mandate of ensuring the nation’s financial system stability.
