Nigeria central bank fines four banks, orders MTN to refund $8.1 bln sent abroad

The Central Bank of Nigeria (CBN) has imposed a total fine of 5.87 billion naira on four commercial lenders for the breach of the country's foreign exchange regulations and ordered the local unit of South African telecoms firm MTN to return $8.13 billion back to the country.

In a tweet by the regulatory bank's spokesman, Isaac Okorafor the telecoms firm and four banks are also to refund the amount "for breaching Nigeria's forex regulations on MTN's illegal capital repatriation."

The banks fined are; Standard Chartered was fined 2.4 billion naira, Stanbic IBTC Bank 1.8 billion naira, Citibank 1.2 billion naira and Diamond Bank 250 million naira. 

The regulatory bank accused the four commercial lenders of aiding the illegal remittance of foreign exchange to offshore investors of MTN Nigeria Communications Limited.

In a statement, the CBN also said that MTN had not obtained approval before transferring the funds and the banks had also breached foreign exchange rules by failing to verify that the telecoms firm had met all the requirements.

The Nigerian telecommunications regulator, Citibank, Standard Chartered and Diamond Bank were not immediately available for comment. A spokesman for MTN declined to comment, while a Stanbic IBTC spokesman said a statement would be issued shortly.

Last November, Nigeria’s Senate approved a report largely exonerating MTN, following an investigation after the business was accused of illegally repatriating $14 billion to its parent company.

At the time, the Senate also asked Nigeria’s central bank to sanction Stanbic IBTC “for improper documentation in respect of capital repatriation and loan repayments” on behalf of MTN.
The Senate also agreed in 2016 to investigate whether Africa’s biggest telecoms firm unlawfully repatriated $13.92 billion from Nigeria, its most lucrative market which generates a third of its revenue, between 2006 and 2016.
Africa’s biggest telecoms firm was fined $5.2 billion in 2015 by the Nigerian government for failing to disconnect unregistered SIM cards on its network. 

The fine was later reduced to $1.7 billion with an option to list its shares on the Nigerian Stock Exchange (NSE).
The company plans to launch the IPO, which has since been delayed due to market conditions, this year.

Okorafor, in the statement, said investigations by the CBN revealed that $3.45 billion was repatriated by Standard Chartered Bank on the basis of illegally issued CCIs.
Similarly, he said the sums of $2.63 billion, $1.766 billion and $348 million were repatriated by Stanbic IBTC Nigeria, Citibank Nigeria and Diamond Bank Plc, respectively during the period 2007 and 2015.