We don’t approve management or maintenance franchise for banks, says NOTAP DG

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Owing to the high capacity that abound in the Nigerian banking industry, the National Office for Technology Acquisition and Promotion (NOTAP) said it would not approve management or maintenance franchise agreement for any bank.

NOTAP’s reaction is on the heels of appeal by the Financial Reporting Council of Nigeria (FRC) against the court injunction obtained by StanbicIBTC from a Federal High Court in Lagos barring it from interfering with activities of Stanbic IBTC Holdings (SIBTCH) Plc.

Justice Ibrahim Abubakar in his ruling last Wednesday granted the prayers of the plaintiffs (SIBTCH) including an interlocutory injunction restraining FRC and its officials from “interfering with or otherwise impending, obstructing, molesting,harassing or hindering” the plaintiffs’ operations.

NOTAP said the banking system having been around and stabilised over the years, has enough capable hands within the country to manage it and should not seek people from offshore for its management.

The Director General, NOTAP, Dan-Azumi Ibrahim said what the agency only approved for banks is software license agreement and not management franchise agreement.
This, he said apply to StanbicIBTC also as the office did not approve management or maintenance franchise agreement for the bank.

The issue among others, a fortnight ago attracted the wrath of the FRC which came down hard on the bank sanctioning it and suspending some of its directors.

In the regulatory decision announced by the FRC, the council barred Atedo Peterside, the Chairman of Stanbic IBTC Holdings, and three directors of the company from signing any financial statement, over allegations of improper disclosures in the bank’s financial statement for 2013 and 2014 financial periods.

Also suspended are the Managing Director/Chief Executive, Stabic IBTC, Sola David-Borha,Arthur Oginga and Daru Owei.

The Central Bank of Nigeria however took a contrary position with its Governor, Godwin Emefiele faulting the regulatory decision of the FRC?

The NOTAP DG while reacting to the development said,” I want to categorically say that we have not approved franchise agreement for Stanbic IBTC bank.

“What was approved for the bank in 2012 was software licenses agreement. It’s like any other bank. Most of the banks are enjoying that facility”.

“They were given approval for three years from 2012 to 2015 and by now I think the certificate might have expired.

“But as far as franchise is concerned, we have not given approval to them. And we categorically made it clear to them that we are not going to give franchise fee agreement approval.”

He explained the non-approval noting that the Nigerian banking system had advanced with enough capacity for its management.

Owing to abundant capacity for the management of banks in the country, any request for franchise agreement made by any bank would not be honored by NOTAP.

“The banking system has been in existence for a very long period of time. And we feel that the country has developed enough capacity to manage banks and we don’t expect to bring in people from outside to come and manage banks in Nigeria.

“It is for that reasons that we have stopped giving banks management service agreement or even franchise.

“But for software we do because it is the software that drives the operation of all the banks and our level of development of software has not reached the level that we will deny the banks certificate or registration of software consultation.

“So as far as maintenance, management and franchise agreement, we are never going to approve it. So the agreement is not approvable and we are not going to approve it.

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