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FG to probe activities of FMBN

 By Yinka Kolawole
The federal government has commenced moves tp probe the activities of the board and management of the Federal Mortgage Bank of Nigeria (FMBN) in a bid to ascertain the veracity of the claims made in petitions made against the bank by various stakeholders.

Minister of Lands, Housing and Urban Development, Mr. Nduese Essien, disclosed in a statement,  last week, that investigation follows the barrage of criticisms and petitions made by sundry persons and groups against the leadership of the apex mortgage institution.

It would be recalled that a group of stakeholders in the housing industry recently petitioned the Housing Minister calling for a probe of the finances of the Federal Mortgage Bank of Nigeria (FMBN).

In the petition, the stakeholders called for an urgent reconstitution of the board of the apex mortgage institution in the country, claiming that the board of FMBN, as currently constituted, is a violation of the FMBN Act, the CBN Code of Corporate Governance, and international best practices.

To buttress their point, they noted that section 2 (1) of the FMBN Act (No. 18 of 1983), which provides for five non-executive directors and four executive directors including the MD/CEO, has not been complied with in the current composition of the board. The present FMBN board has only two non-executive directors and six executive directors.

Essien said that the government is already studying the petitions and allegations against the bank and that it will soon make its position known, noting however that due process would be followed during the investigation. He explained that there was the need to do justice not only to the various stakeholders and the authorities involved. 

The minister further assured that all the issues raised by the interested parties will be given due attention to restore public confidence in the apex mortgage bank. “We are aware of the growing concern of key stakeholders on the operations of the Federal Mortgage Bank of Nigeria. That is why we have taken measures to investigate all the allegations made against the leadership of the bank. I want to assure Nigerians that we will soon come up with a position on the matter so that public confidence will be restored in the bank,” he stated.

The petitioners contend that the lopsided nature of the FMBN board gives the executive management unlimited and excessive powers to run the institution arbitrarily without checks and balances. Other allegations in the petition include: absence of board committees meant to separate policy formulation from policy implementation and thus ensure transparency; over-promotion of some staff members of the bank; failure to declare a profit since 1993; total reliance on contribution from the National Housing Fund for its operations; most loans for both estate development and primary mortgage are non-performing; and except for 2005, FMBN’s accounts have never been audited and printed.


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