MD's Largesse causes row in Skye Bank

Mr. Akinsola Akinfemiwa

It was clearly not the type of legacy he planned to leave behind in a bank that he has been so proud of leading since January 2006 when it commenced operations ...

But now, Mr. Akinsola Akinfemiwa, until July 31 2010, the Group Managing Director and Chief Executive Officer of Skye Bank Plc , when he had to step down in compliance with the Central Bank of Nigeria(CBN) policy that fixed the tenure of bank Chief Executive Officers at a maximum of 10 years, would be asking himself if his alleged decision to sign off on a whopping N30million as parting gift to each of the bank's 10 member executive management team as well as its Assistant General Managers was a wise one, after all, as it is threatening to do serious damage to the bank.  
Reports reaching Business Hallmark at the weekend indicate that other senior executives of Skye Bank who did not benefit from the alleged largesse are demanding to know why they were left out. This has led to a lot of bad blood and the heightening of tension in the second tier financial institution which was not known to have experienced any form of industrial unrest throughout Mr. Akinfemiwa's tenure as Chief Executive Officer.
Business Hallmark's findings reveal that the seeming refusal of the bank's management to provide clear answers to the affected staff has led many of them to begin to question the motive behind the alleged gift. According to a source within the bank, “the feeling is strong that the loud silence that has surrounded the entire issue is due to the fact that the payment was actually meant to buy the silence of the top officials that received it.” He, also, stated that the method through which the payment was effected further lent credence to the belief that there was something suspicious about it as it did not pass the normal channels in the bank. Said the source, “The cheques that were used to pay these executives were not Skye bank cheques but were routed through a government agency. Now people are asking what type of service did these executives perform for this government agency that they have been paid such a staggering amount of money.” He pointed out that the total payments came up to over N330million and that for such a huge sum to be paid out, it had to be backed with proper documentation.
A Skye bank shareholder who said that he had not yet heard about the matter, however, warned that if it turned out to be true, the shareholders' groups would not take it lying low. “If it turns out to be true, we the shareholders are going to protest. The banks are not paying dividends because of the difficult operating environment, they are sacking workers, so we would want to know what the bank's top executives are being rewarded for.”
An industry source who did not want to be quoted told Business Hallmark that it was matter of great regret that Mr. Akinfemiwa who seemed to have set a great store by high corporate governance standards throughout his career as a banker was ready to risk his hard-earned reputation in that area by refusing to give adequate clarification on why the said payment was allegedly made. Other industry analysts, pleading anonymity, stated that they were not all that surprised about the issue, pointing out that there were bound to be some grey areas in some of the transactions that Skye Bank was involved with given the bank's active engagement with the public sector. The bank is known to control the account of one of the wealthiest States in the country. It also controls some accounts of a leading oil producing State.
Business Hallmark's investigations, however, reveal that Skye Bank may not be the only bank affected by this problem as there are speculations that one or two other banks may also be involved in it.
However, Business Hallmark is currently digging into the last-minute deals concluded by some of the banks' executives suspected to have compromised on the tenets of corporate governance.
In a telephone chat with Business Hallmark, a Port Harcourt-based lawyer, Mr. Patrick Chukwuweike, contended that it would be almost impossible for a bank CEO to perpetrate the kind of massive fraud that is perpetuated at that level without the knowledge or connivance of some executive directors. Noting that many top bank officials are privy to all the fraudulent transactions that their bosses perpetrate, he stressed that it was natural to expect that a departing CEO would be scared that his going could result in some of his misdeeds being exposed and would want to do something about it .
He recalled the story of a business mogul who as Chairman of one of the biggest banks in the country in early 2000, was said to have been involved in some fraudulent deals that he had perpetrated with the help of one of his close associates in the bank. The said Chairman was later forced by the regulatory bodies to resign.
Skye Bank is a merger of former Prudent Bank, EIB International Bank, Bond Bank, Reliance Bank and Cooperative Bank. The bank has over 300,000 shareholders and has a shareholding structure that puts no more than 5 per cent, in the control of any one individual or company. It has more than 250 branches and transaction centers across the country as well as offices in the Gambia, Sierra Leone and Guinea Republic. It employs over 6000 professional bankers and business experts within a N1 Trillion balance sheet size.