CBN revokes the licenses of Aso Savings and Loans Plc and Union Homes Savings and Loans Plc over regulatory breaches and financial distress.
The Central Bank of Nigeria (CBN) has withdrawn the operating licenses of Aso Savings and Loans Plc and Union Homes Savings and Loans Plc, citing persistent regulatory infractions and deep financial weaknesses.
In an official statement released on Tuesday, the apex bank said the decision was taken in line with Section 12 of the Banks and Other Financial Institutions Act (BOFIA) 2020 and Section 7.3 of the Revised Regulatory and Supervisory Guidelines for Primary Mortgage Banks in Nigeria. According to the CBN, the action forms part of ongoing measures to sanitize the financial system and strengthen the mortgage banking sub-sector.
Investigations by the regulator revealed that the two institutions failed to comply with several critical requirements, including maintaining the prescribed minimum paid-up share capital for their license category. The banks were also found to have inadequate asset bases relative to their liabilities and were severely undercapitalized, with capital adequacy ratios falling below regulatory thresholds.
In addition, the affected mortgage banks reportedly ignored multiple regulatory directives and obligations issued by the CBN over time, raising concerns about their operational sustainability and corporate governance practices.
The statement, signed by Mrs. Hakama Sidi Ali, Acting Director of Corporate Communications, reaffirmed the apex bank’s resolve to protect the financial system, stressing that the CBN “remains committed to its core mandate of ensuring financial system stability.”
Both Aso Savings and Loans Plc and Union Homes Savings and Loans Plc have faced prolonged operational challenges, including depositor complaints, governance concerns, and eventual delisting from the Nigerian Exchange (NGX) in 2024 after failing to submit audited financial statements for more than six years.
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With the revocation now in effect, the two institutions are no longer authorized to operate as licensed mortgage banks in Nigeria. The CBN advised depositors and other stakeholders to await further guidance from the Nigeria Deposit Insurance Corporation (NDIC) regarding possible liquidation or resolution arrangements.