Shareholders of Stanbic IBTC Holdings have appealed to the Federal Government to look into the activities of the Financial Reporting Council (FRC) in order to forestall more damage to the operations of businesses and the larger economy.
Boniface Okezie, president, Progressive Shareholders Association of Nigeria, made the appeal while speaking with journalists over the recent altercation between FRC and Stanbic IBTC Bank.
Okezie, who was flanked by other members of the association, said that shareholders were shocked by the actions of the FRC which he said did not follow the procedure as outlined in the regulations.
According to him, “in a case where a corporate body disagrees with FRC’s interpretation of its accounts, FRC ought to go to court according to Regulation 27 of the Directorate of Inspection and Monitoring Guidelines Regulations. Instead, the FRC took to the media to make several questionable allegations against a corporate body.”
Expressing shock and disappointment at the approach deployed by FRC, Okezie pointedly said: “We would have expected FRC to recognise that circumspection ought to be its guiding standard,” adding that the role of the FRC is to help enhance the quality of financial reporting in Nigeria and that the “FRC is not a regulator of banks neither is it a regulator of the capital market.”
The FRC, he added, ought to have recognised the implication of its reckless pronouncement in an unsophisticated capital market as it could lead to panic among investors.
“Unfortunately, this recklessness has already made this happen as we have recorded losses in our share price over the last two days on account of the misguided actions of the FRC,” he claimed.
Affirming confidence in the leadership of the Board and Management of Stanbic IBTC, the association’s president said: “We have always commended the transparency and commitment by the Board to conduct business only in line with world class corporate governance principles. It is on account of this that Stanbic IBTC Holdings PLC is the only bank in Nigeria that has an AAA Fitch rating.” He added that shareholders support the bid to expand the operations of the bank as this would “guarantee optimal returns on our investment.”
Expressing disappointment at the manner in which FRC is executing what it believes is its mandate; Okezie again, observed that FRC is currently “operating without the necessary oversight to moderate its excesses.”
He urged President Buhari to urgently constitute a Board for the FRC, stressing that “Such a Board will exert control and limit the excesses of the FRC which is currently run as a one-man-show by its Executive Secretary.”
With the conclusion of the screening of the ministerial nominees by the Senate, Okezie expressed the optimism that deployment of a technocrat as Trade and Investment minister could check the excesses of FRC.
“We also call on the President Buhari to deploy a tested technocrat to head the Ministry of Trade and Investment. This minister will also exert a controlling influence on the activities of the FRC and help to ensure that good intentions of government are not thwarted by the incompetence and lack of exposure of publicity-seeking and egocentric professionals.”
He called on all of the bank’s shareholders to, “in the collective interest of our overall investment in the bank, seek internal mechanisms to resolve any differences rather than resort to the use of manipulative regulators.”
Okezie said his interest in the issue as a shareholder is to “see that the bank survives,” adding, “If we allow them to continue to do what they are doing, they will kill institutions. If we are regulating, we must regulate well.”
