October 21, 2021


documenting the nigerian story…

How Polaris bank fully refunded NNPC’s $223m to FG

More facts have emerged on the issues surrounding the $223 million lodged with Polaris Bank by the Nigerian National Petroleum Corporation (NNPC) since 2012.

This follows the disclosure made by the Acting Managing Director of the bank, Innocent Ike, at a public hearing before the House of Representatives ad hoc committee on assessment and status of all recovered loot from 2002-2020.

Daily Trust intercepted a copy of the letter titled: Re: Invitation to investigative hearing In respect of NNPC deposit of $223,862,000 with the bank.

The letter which was dated June 21 and sent to the chairman of the Ad-Hoc Committee on the Assessment and Status of Recovered loots Hon. Adejoro Adeogun through the office of the Bank’s General Counsel Segun Tawoju provides extensive insight into the alleged controversial deposit.

The letter which had 10 annexures copiously provided details and revelations on the issues surrounding the transaction.

The Committee had during the sitting queried why the money had spent seven years with the bank without any action, adding that the bank must have thought the money had been forgotten.

According to the Chairman of the Committee, Adejoro Adeogun whilst grilling the Managing Director of Polaris Bank “You have about six years when this deposit was in your custody. It is impossible to forget 300 million U.S dollars; were you thinking it has been forgotten?”

The Bank had through its letter explained that following the regulatory Intervention of Central Bank of Nigeria’s (CBN) in the defunct Skye bank on July 4, 2016, the new board and management immediately set out to address the various irregularities and shortcomings, chief of which was the inability of the Bank to remit the NNPC deposits which had been in the custody of the Bank for several years to the Treasury Single Account (TSA), as directed by the Federal Government of Nigeria (FGN) due to liquidity issues.

Ike  explained that the said money which was lodged with the Bank by the NNPC was at no time hidden from any public or government agencies noting that the Bank  interacted and fully co-operated with several agencies including the Economic and Financial Crimes Commission (EFCC), Inspector General of Police Special Investigation Panel, the Department of State Security (DSS), Presidential Panel on Recovery of Public Property, Senate Committee on Banking, House of Representatives Ad-Hoc Committee on Treasury Single Account.

To further show transparency in the transaction, the Acting Managing Director explained that part of the strategy adopted in payment of the deposit was to remit it to the Central Bank of Nigeria (CBN) and then give the apex bank instruction to credit the NNPC.

Corroborating the process leading to the final payment, the Bank in the June 21 letter explained that:  “In February 2019, as a demonstration of good faith, the Bank made a proposal to commence installment payment of the sum of $10million monthly into the NNPC TSA account with the CBN, and began doing so immediately. Eventually, the FGN being satisfied with the Bank’s transparent and diligent conduct in remitting the monthly funds without fail, entered into Terms of Settlement with the Bank for the continued monthly remittances of $10m to the TSA. The Terms of Settlement were filed and adopted as consent judgment by the Court on 10th October 2019, eight months after remittance commenced by the current management (see attached consent judgment as Annex 3)”

Investigations also show that the initial sum deposited at the time of opening the account in 2012 was about $30m which grew over time with subsequent deposits amounting to $224,324.958.75 at the point the CBN intervened in the bank in 2016. Before then, however, the troubled account had remained relatively active with payments and withdrawals.

“We are pleased to state that as at today, the total sum of $224,324.958.75 which was the outstanding balance in the account as at February 2019 has been paid while the figure of $32,041,010.83 still reflecting in the account statement is the entry yet to be passed to nil off the balance remitted through cash lodgment (see correspondence with CBN in March 19, 2021 as annex 9)” The Acting Managing Director explained.

Following queries that the NNPC was yet to confirm the receipt of the money paid into the CBN’s account, Ike stated that they are expecting NNPC to write and confirm payment, stressing that Polaris Bank had written to the apex bank to that effect since March 19, 2021.