Publications
Partners
Johannesburg - Standard Bank [JSE:SBK], which operates Stanbic IBTC Holdings in Nigeria, said a regulator in the country exceeded its powers when it ruled the bank’s West African unit had made material misstatements in its financial accounts and recommended a fine.
Lawyers have advised the bank that the Financial Reporting Council of Nigeria’s notification and “an associated purported” fine against Stanbic IBTC of 1 billion naira ($5m) don’t comply with proper processes, the bank said in a statement on Friday.
The Nigerian unit’s auditor, KPMG, has confirmed it stands by its opinion on the 2013 and 2014 financial statements, the bank said.
The FRCN on October 26 ordered the suspension of four past and current Stanbic IBTC directors, including Chief Executive Officer Sola David-Borha and Chairman Atedo Peterside, after accusing them of posting misleading statements.
The Nigerian securities exchange suspended Stanbic’s proposed share sale in September as the FRCN began its investigation.
The issue under dispute is how to account for cross-border payments, according to Standard Bank, which said Stanbic IBTC has been treating payments to units of the lender in other African countries as liabilities.
The payments “should continue to be reflected as liabilities, given the increasing difficulties in obtaining regulatory approval for cross-border payments,” Standard Bank said Friday.
Stanbic IBTC maintains that there were no material misstatements in its financial accounts for 2013 and 2014, the bank said.
The potential financial effect of the Nigerian regulator’s action isn’t material, according to Standard Bank. Its shares advanced 1% to R144.49 by 11:57 a.m.
Regulatory Battles
The lender, Africa’s largest by assets, isn’t the only foreign company tussling with Nigerian authorities.
The country’s telecommunication’s regulator has imposed a $5.2bn fine on MTN Group [JSE:MTN] for failing to disconnect customers with unregistered sim cards. MTN has been told to pay the penalty by November 16.
In the past two years, Standard Bank has been fined by regulators in the UK and South Africa for failures in anti- money-laundering controls.
It may be among banks facing a US investigation for precious metal price manipulation, people with knowledge of the matter said in February.
It has been named in a US class action suit that claims the lender, and others, manipulated platinum and palladium prices.
Standard Bank was also named in the South African Competition Commission’s rand- rigging probe, which has yet to be concluded.
