CBN orders 4 banks to suspend payment of MTN dividends — By Louis Iba

The crisis rocking South African telecoms company MTN Group’s operation in Nigeria worsened yesterday as the Central Bank of Nigeria (CBN) ordered four Nigerian banks to suspend all forms of dividend payment from MTN Nigeria.
This comes as the CBN spokesman Isaac Okoroafor, in a text message to Daily Sun denied knowledge of the suspension order. “I am not aware of such order, Okoroafor said.
It was however learnt that the suspension order by the apex bank followed recent allegations by the Nigerian Senate that MTN Nigeria, a subsidiary of the MTN Group had repatriated about $13.97 billion out of Nigeria illegally between 2006 and 2016. It is the second time in just two years that the telecoms giant will be battling with allegations of flouting regulatory laws in Nigeria. Earlier in the year, the Federal Government had to slash an initial fine of $3.9billion imposed on MTN to N330 billion over its failure to disconnect unregistered mobile phone users as was directed by the Nigerian Communication Commission (NCC).
But MTN Group in a quarterly update to shareholders made available to journalists yesterday, said it was not guilty of the latest allegation of illegal dividend repatriation leveled against it by the Nigerian Senate, stressing the claims were totally unfounded and without merit.
Addressing the latest developments on the alleged illegal repatriation of $13.97 billion by the MTN Group, the telecoms firm disclosed that the CBN had ordered the four commercial banks, operated by it, to suspend dividend payout from Nigeria.
“MTN Nigeria, four commercial banks, certain MTN Nigeria directors and shareholders, the Central Bank of Nigeria and others appeared before the Senate on October 20, 2016, at the outset of this investigation,” the statement read.
“The allegations are that $13.97 billion was repatriated illegally by MTN Nigeria through its bankers. MTN Nigeria and its bankers are cooperating with the investigation with a view to resolving the matter as expeditiously as possible.
“In the interim, the CBN has instructed the banks to suspend any remittances of dividends until further notice. MTN Nigeria continues to refute the allegations that it had improperly repatriated funds from Nigeria,” the statement added.
Meanwhile, Citigroup has issued a statement denying being involved in any illegal foreign currency transfer on behalf of MTN Group, according to a presentation the U.S. bank gave to the Nigerian parliament.
“We wish to state categorically that Citibank Nigeria Limited was at no time involved in any illegal foreign currency repatriation on behalf of MTNN (MTN Nigeria) or any other customer,” Citibank said in a presentation to the parliament.
MTN Nigeria has also said it will strongly defend any action that would be prejudicial to its interest. “MTN Nigeria has no intention to make any dividend payments over the next six months,” the company said.
It also said it remains committed to the payment of the N330 billion fine related to the late disconnection of ‘improperly registered’ SIMS, adding that its subscriber base increased by 1.5 million in three months.

Culled from The Sun