Falalu Bello resigns as Mainstreet Bank Chairman – THE CITIZEN

The Chairman of Mainstreet Bank Ltd, Mallam Falalu Bello, has resigned his appointment with the bank, THE CITIZEN has learnt.

According to a source who confided in our correspondent, Bello bowed to pressure that emanated from a petition from his former bank, Unity Bank, which had appealed against him to the Central Bank of Nigeria (CBN), over allegations bordering on breach of corporate governance when he was the managing director of the bank.

“After the consideration of the petition written by Unity Bank against him, the CBN wrote a response to the bank and copied the management of Asset Management Corporation of Nigeria (AMCON), indicting the former managing director of gross breach of corporate governance. This consequently prompted theAMCON management to advise him to resign from his position as the Chairman of Mainstreet Bank on the strength of CBN’s letter,” the source disclosed.

Recently, Unity bank Plc was in a dispute with its former Managing director, Falalu Bello, who is now Executive Chairman of MBS Merchants Limited, over an alleged one-party approval of N3.4 billion ($21.067 million) foreign exchange deal.

The bank had in a petition to the CBN alleged that Bello unilaterally approved the said amount for his company to import fertilizer, but he had been foot-dragging to pay back the facility.

THE CITIZEN learnt that the new management of Unity Bank led by Mr. Henry Semenitari was unhappy with the situation and petitioned the CBN over the matter alleging violation of corporate governance by the former boss.

The petition signed by Ahmed Yusuf, Acting Executive Director, Enterprise Risk Management and Umar M. Adamu, Divisional Head, Legal and Compliance, with Ref. No UB/L&C/UMNHJSIMB5FB/02l14, dated3rdFebruary, 2014, to the Governor of CBN stated: “We hereby humbly write to bring to your notice instances of Violation of Code of Corporate Governance. Sometime between June to September 2013, three Deferred Letters of Credit (LCs) totaling$21,067,500.00 were opened in favour of MBSMerchants Limited”.

Besides the CBN, Unity Bank also petitioned the Inspector General of Police, Mohammed Abubakar,over the matter, which prompted the invitation of Bellofor questioning by the Force Criminal Investigation Department (FCID) Headquarters in Abuja.

A statement issued by MBS Merchants also admitted that Bello was invited to the Office of the Inspector General of Police (IGP) in Abuja to clarify issues in connection with a petition by Unity Bank Plc to the Central Bank of Nigeria (CBN) and the IGP.

The statement said the petition was based on three deferred letters of credit issued by the bank on behalf of MBS Merchants.

“In this regard, the MBS has answered all CBN enquiries on the matter. Also, Mallam Falalu Bello was invited by the IGP to discuss the same issues involved, being a recipient of the same petition”.

“Based on his position as chairman of MBS, Bello equally answered the invitation of the IGP just as he did that of the CBN so that such high level discussions between the parties involved will bring closure to a matter, which is basically a financial transaction between two parties that have been business partnersfor over seven years,” the statement said.

It could be recalled that Bello retired as the Group Managing Director of Unity Bank Plc on June 30, 2011, and was shortly afterwards, appointed chairman of Mainstreet Bank, one of the three banks nationalised by the Sanusi Lamido Sanusi-led Central Bank of Nigeria.

According to a source, since his emergence as the Chairman of Mainstreet Bank, there has been no love-lost between him and the managing director of the bank, Ms. Faith Tuedor-Matthews.

In February 2013, there were media reports that Tuedor-Matthews had resigned her appointment over alleged misappropriation of funds.

It was alleged that she transferred funds into her private accounts abroad, which was said to haveimpelled the Board led by Bello to suspend her. However, the story was unfounded.

Nevertheless, their rivalry was said to have polarised the staff of the bank and affected their productivity. During the height of hostilities, staff perceived to be loyal to Bello were allegedly transferred from the headoffice and the partitions in all the offices, except on the executive level, were dismantled to allow a see-through floor plan. It was also purported that the strategy was to unmask any clandestine movement or motives by Bello loyalists.

In the meanwhile, there is no replacement yet for the former chairman, Falalu Bello. But, a source in AMCON told our correspondent that his successor would, most likely, be selected from current Boardmembers since the bank would be sold to a new core investor soon.

However, a financial analyst who spoke to THE CITIZEN on condition of anonymity stated that it’s a good development both for the bank and the former chairman.

“It’s is good development in the sense that it will afford Bello the opportunity to clear himself of all the allegations and what he has done is professional in accordance to corporate governance code.

“He is a sound lawyer and well respected banker. I am sure he will come out of the situation stronger and still hold his head high,” he said.

To the bank, he opined that the friction in the board will end with his exit. Adding that the management will heave a sign of relieve and swing back into action to take that bank to greater height. 

“There is absolutely no reason for the seeming fight if not for ego. The actors were on both national assignment to rescue a bank and the mission is clear. But for certain reasons they never agreed. But now that he is out of the way, the bank can swing back into action with more impetus as the distraction is over now,” he said.

All efforts to reach the bank and Mallam Bello for comments before press time all proved abortive.