Stanbic IBTC to sue loan defaulters

Stanbic IBTC to sue loan defaulters




Stanbic IBTC, the Nigerian subsidiary of South Africa’s Standard Bank, says it will publish the list of loan defaulters in line with a new directive by the Central Bank of Nigeria.

The CBN had in April and June expressed concerns over the spate of non-performing loans in banks and ordered banks to commence the publication of the names of chronic debtors from August 1.

Stanbic IBTC in a public notice to its customers on Wednesday said in addition to publishing the list of defaulters by the end of August, it would also use legal and other means to recover non-performing loans.

The notice, which was published on page 48 of The PUNCH on Wednesday, was entitled, ‘Payment of outstanding obligations owed to Stanbic IBTC Bank Plc.’

It read in part, “As you may be aware, the Central Bank of Nigeria recently directed banks to notify their individual and corporate customers that have for over 365 days failed to pay the outstanding principal and interest amounts due on their loans that they have until August 2015 to settle such outstanding obligations. Please note that our bank intends to fully comply with the terms of the CBN directive.

“Please note that the fact that we publish any customer’s details in the manner prescribed by the CBN will not preclude our bank from commencing or continuing any and all legal remedies available to it for the recovery of the amounts owed by him/her/it to our bank.”

Some analysts believe the CBN’s directive will forestall a repeat of the 2009 banking sector crisis in which the Federal Government spent trillions of naira to bail out banks.

The central bank had in April directed banks to give bad debtors three months to pay their outstanding loans, following which their names would be published in newspapers and barred from taking part in the nation’s foreign exchange and debt markets.

Other banks may soon commence issuing of similar warnings to their loan defaulters.

Last Thursday, the CBN said the banking sector currently had a total loan portfolio of between N13tn and N14tn, noting that about three per cent of this was non-performing.

Going by the figure, the total non-performing loans of the banking sector are in the range of between N390bn and N420bn.

In 2009, the central bank rescued several banks that had lent mainly to the oil and gas sector just before crude prices collapsed, triggering a near-collapse of eight banks.

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Stanbic IBTC to sue loan defaulters