Heritage Bank begins SGBN accounts validation exercise

Customers of former Societe Generale Bank Plc (SGBN) are set to heave a sigh of relief as it formerly begins a four-week validation exercise on Tuesday (tomorrow) under a new name- Heritage Banking Company Limited.

This is coming exactly seven years after the commercial banking licence of SGBN was revoked on January 16, 2006 for failing to meet the December 31, 2005 recapitalisation deadline set by the Central Bank of Nigeria (CBN).

The apex bank had given an 18-month grace for Nigerian banks to raise their minimum capital base to N25 billion, or engage in mergers and acquisitions to achieve the target, as a result of which 89 banks reduced to 25, while 14 others including SGBN was left in the lurch.

For a start, Heritage Bank will open its branches to customers of old SGBN as a regional player (with a minimum capital of N10 billion) under the name, following CBN approval.

The reopening of the old SGBN as Heritage Bank, according to a report last year, followed the injection of fresh capital by the former owners- the Olusola Saraki family with about 10 per cent, and International Energy Insurance (IEI) Plc, which has Ifie Sekibo, as executive vice chairman as a major shareholder.

A statement by Heritage Bank’s spokesperson, Mrs. Josephine Aligwekwe, a fortnight ago, quoted the CBN letter conveying approval titled, “Re: Application for a Commercial Banking Licence with Regional Authorisation,” dated December 27, 2012. The letter with reference number FPR/LAD/CON/HBC/02/062, was signed by the CBN Director of Financial Policy and Regulations, Chris O. Chukwu.

Aligwekwe, who is group head, Corporate Affairs of the bank, announced that with the CBN approval secured, it is set to commence operations immediately in conformity with the terms of the Licence.

“All customers of the former Societe Generale Bank (Nig.) Limited are advised to look out for announcements in the national dailies detailing the processes and procedures for the account validation exercise”, the statement said.

The return of SGBN’s licence, followed a favourable June 2008 ruling by Justice Binta Murtala that the CBN’s revocation order was “in bad faith, unconstitutional, null and void.”

SGBN had denied allegations that it made no effort to recapitalize, as merger talks with Unity Bank was at advanced stage at the time its licence was revoked, blaming the CBN for frustrating its effort to conclude the arrangement before the deadline expired.

[DailyIndependent]