GTBank’s infractions were not limited to Nigeria. The bank was also fined in Ghana and Rwanda for similar breaches of foreign exchange operational guidelines, with penalties amounting to an equivalent of N1.297 billion in Ghana and a breakdown of the sanctions from Rwanda indicated that GTCO got a N560,000 for non-compliance nited for the bank taking fee which are nit allowed by the regulator and a N311,000 fine for non-compliance with exchange rate applied by commercial banks in Rwanda. – The ICIR report
Abdulrahman Aliagan,
In a significant crackdown on foreign exchange violations, Guaranty Trust Bank (GTBank) and 9 other banks have been handed a hefty fine of N188.25 million by the Central Bank of Nigeria (CBN). This penalty stems from a series of infractions uncovered during the CBN’s 2023 Foreign Exchange Examination, violations of consumer protection regulations, and compliance-related issues highlighted in the recent 2024 Mystery Shopping Exercise.
The CBN’s stringent examination of GTBank and other nine
(9) banks is part of a broader regulatory effort that has seen ten banks in Nigeria sanctioned for breaching foreign exchange guidelines and other compliance issues.
The total fines imposed across these institutions have reached a staggering N1.502 billion in the first half of 2024 alone, underscoring the ongoing challenges banks face in adhering to the regulatory framework designed to protect the integrity of the financial system.
Among the banks penalized alongside GTBank are notable names such as Access Bank, Zenith Bank, and First City Monument Bank. Zenith Bank incurred the largest penalty at N427 million, followed closely by Access Bank at N300 million. UBA and Stanbic IBTC also faced steep fines of N279 million and N229 million, respectively.
GTBank’s infractions were not limited to Nigeria. The bank was also fined in Ghana and Rwanda for similar breaches of foreign exchange operational guidelines, with penalties amounting to an equivalent of N1.297 billion in Ghana and a breakdown of the sanctions from Rwanda indicated that GTCO got a N560,000 for non-compliance noted for the bank taking fee which are not allowed by the regulator and a N311,000 fine for non-compliance with exchange rate applied by commercial banks in Rwanda, ICIR reports. This international scrutiny raises questions about the bank’s compliance culture and operational integrity across borders.
In the wake of these penalties, civil society organizations have raised alarms about the transparency of financial operations at major banks. Alhaji Yusuf Kabir, President of the Arewa Consultative Movement, has called for a forensic audit of GTCO’s financial statements, particularly given the bank’s historic profits in the sector.
Responding to these concerns, the CBN reaffirmed its commitment to ensuring the stability of Nigeria’s financial system. In a recent statement, the bank emphasized the importance of regular stress tests, which are conducted to identify potential vulnerabilities in financial institutions before they escalate into systemic risks.
As the financial landscape continues to evolve, the repercussions of these regulatory actions extend beyond mere financial penalties. They serve as a reminder to all banks operating in Nigeria that compliance is not optional; it is a fundamental aspect of maintaining trust and stability in the financial system.
With GTBank now facing heightened scrutiny and a significant financial burden, the question remains: can the bank restore confidence among its stakeholders while navigating the turbulent waters of regulatory compliance?
The coming days, months and years will be crucial as GTBank and its peers work to address the challenges posed by both regulatory authorities and the public’s demand for greater transparency and accountability.
Aliagan writes from Abuja.
