CBN revokes licenses of two mortgage banks

The Central Bank of Nigeria has withdrawn the operating licences of two mortgage banks as part of steps to strengthen regulation and compliance within the mortgage sub sector. The apex bank announced the decision in a circular issued on Tuesday, December 16, and signed by its Acting Director of Corporate Communications, Hakama Ali. According to the CBN, the move is aimed at repositioning the mortgage banking space and enforcing adherence to existing laws and regulatory guidelines. The affected institutions are Aso Savings and Loans Plc and Union Homes Savings and Loans Plc. The CBN said the action was taken in line with its powers under Section 12 of BOFIA 2020 and Section 7.3 of the Revised Guidelines for Mortgage Banks in Nigeria. Explaining the decision, the bank stated that the institutions breached several regulatory requirements. The affected institutions had violated various Sections of BOFIA 2020 and the Revised Guidelines for Mortgage Banks in Nigeria, including: failure to meet the minimum paid up share capital requirement for the category of the bank licence granted to them by the CBN, and having insufficient assets to meet their liabilities. The regulator also pointed to deeper financial weaknesses, noting that the banks were critically undercapitalised and failed to meet prudential standards. Other infractions listed included a capital adequacy ratio below the required minimum and non compliance with multiple directives issued by the CBN. Reaffirming its position, the central bank added, The CBN remains committed to its core mandate of ensuring financial system stability.The post CBN revokes licenses of two mortgage banks appeared first on Linda Ikeji Blog.