Abuja: The Central Bank of Nigeria (CBN) has revoked the operating licences of Aso Savings and Loans Plc and Union Homes Savings and Loans Plc. This action marks a significant step as part of the CBN’s strategy to reform the mortgage sub-sector and ensure adherence to legal and regulatory standards.
According to News Agency of Nigeria, the decision was announced by CBN’s Acting Director of the Corporate Communications Department, Hakama Sidi-Al. The revocation stems from the CBN’s authority under Section 12 of the Banks and Other Financial Institutions Act (BOFIA) 2020, along with Section 7.3 of the Revised Guidelines for Mortgage Banks in Nigeria. The affected institutions were found in violation of various sections of these regulations.
Sidi-Al highlighted that these violations include the failure to meet the minimum paid-up share capital requirement specific to the category of their bank licence issued by the CBN. Furthermore, the institutions were identified as having insufficient assets to cover their liabilities and were critically undercapitalised, with a capital adequacy ratio falling below the prudential minimum required by the CBN.
Sidi-Al also noted that the banks failed to adhere to multiple directives and obligations imposed by the CBN, which further warranted the decision to revoke their licences.