STANBIC,FIRST BANK,UBA SHED N90.6bn AFTER SANCTION

Stanbic, First Bank, UBA shed N90.6bn after sanctions

Simon Ejembi

Stanbic IBTC Holdings Plc, FBN Holdings Plc and United Bank of Africa Plc lost a total of N90.647bn of their market capitalisation last week after news emerged on Monday that they had been sanctioned by the regulators of the financial market.

The Financial Reporting Council of Nigeria had on Monday directed Stanbic IBTC Holdings to withdraw its financial statements for 2013 and 2014, and restate them after concluding that the statements were misleading and that the group concealed information and violated the requirements of the International Financial Reporting Standards, among other alleged infringements.

It also suspended the Chairman, Stanbic IBTC, Mr. Atedo Peterside; the chief executive officer, Mrs. Sola David-Borha; and two other directors, Mr. Arthur Odinga and Dr. Daru Owei; as well as KPMG’s Ayodele Othihiwa from vouching for the integrity of any financial statements issued in Nigeria.

Also on the same day, reports emerged that the Central Bank of Nigeria had on October 23, 2015 fined UBA and First Bank of Nigeria Limited, a subsidiary of FBN Holdings, N4.819bn for failing to comply fully with the Federal Government’s directive on the remittance of government revenue to the Treasury Single account.

First Bank was asked to pay N1.877bn, while UBA was fined N2.942bn.

A review of the performance of the stocks of all three companies for the week showed significant decline in their share prices and a huge fall in their market capitalisation.

Although Stanbic IBTC Holdings, KPMG Professional Services and some shareholders have countered the FRC’s decision, the group’s shares fell by 17.97 per cent from N23 to N18.91, with its market capitalisation falling by N40.9bn in five trading sessions.

FBN Holdings Plc, which on Thursday confirmed to the Securities and Exchange Commission that it had paid the N1.877bn fine imposed on it, saw its share price declined by 14 per cent from N5.93 to N5.10, and its market capitalisation dipping by N29.793bn last week.

UBA, had on its part, notified the Nigerian Stock Exchange of the sanction and that it was engaging the Central Bank of Nigeria on the decision.

However, that did not stop its shares from declining by 13.58 per cent from N4.05 to N3.50 last week. Its market capitalisation also fell by N19.954bn during the week.

Stanbic IBTC Holdings was the fourth biggest price loser for last week, while FBN Holdings and UBA occupied the fifth and sixth on the losers’ chart, respectively during the week.