Stakeholders laud/ knock to CBN over dividend rule
Cross- section of stakeholders have expressed reservations on the new rule by the Central Bank of Nigeria(CBN) on payment of dividend bank banks with high none performing loans and less capital adequacy ratio.
Speaking to our correspondent in an interview, cross -section of stakeholders lauded CBN , while others maintained that the apex bank may have abdicated its responsibility on bank’s supervision until things started getting out of hands.
Principal partner, Matog Consulting, Matthew Ogagawhoria said that even as the CBN would be seen to have acted in defence of the financial system, if the apex bank regulator digs deeper, more banks would be affected by the new rule.
He said, “Most banks will be affected if CBN digs”
Olatokunbo Gbadebo, shareholder activist, and co-founder, Nigeria Shareholders Solidarity Association-NSSA , termed the rule as, “”Banks bad Loans, no dividends for Shareholders by CBN” and a bomb-shell to the expectations of shareholders on returns on investments.
Gbadebo termed the rule as a “sadist-policy to returns on investments in the banking-Industry, adding that the apex bank regulator has a job to be done and it must be done effectively.
He said that the emerging issues from the policy spelt that shareholders must now increase their surveillance on banks board and managements to be more accountable.
“”if banks were unable to pay dividend, l am of the opinion that any bank that failed the test of CBN on Dividend-Payment, shouldn’t pay emoluments to their directors; while the Management should lose their bonuses/welfares and be responsible for the payment on any sanction from the CBN forthwith.
According to him, the committee of bank, that approved bad loans, should be have questions to answer, while insider defaulters (Managements/Directors) must be made to face the music.
He said that, though, the new policy was against principal of returns on investments, however, it is very necessary as it further called on prosecution of bank chiefs boosting non-performing loans (NPL)
“”therefore , they must be sanctioned for their actions, because they were the ones that breath lives into those banks and also they were the same people suffocating the banks, because such behaviours led to the Madness of 2009”.
The managements/directors of the banks, Adekotunbo said, “should be held responsible for none Payment of Dividends to shareholders”
The National Coordinator of Constance Shareholders Association of Nigeria, Mallam Shehu Mikhail lauded the new rule adding that it would help to checkmate both board and management of financial institutions.
“This new rule is a welcome idea because ,it will help shareholders to understand and monitor all the business activities of the bank and also make shareholder to be able to ask most necessary questions both from the auditing firms.”
He added that the new policy will help in revealing the real status of the financial institutions and their commitment in keeping with laid down regulation and working harder to meet shareholders expectations
“I do know that with this new rules most banks will be willing to work to the expectation of their stakeholders and shareholders”
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Stories by Bonny Amadi
