Elumelu says insider loan in UBA within limit

The Group Chairman, United Bank for Africa (UBA) Plc, and Founder, The Tony Elumelu Foundation, Mr. Tony Elumelu, has said strict corporate governance is upheld with regards to insider loan in the bank where he serves as chairman.

Elumelu was responding to questions on insider loan yesterday while featuring on ‘The Morning Show’ on ARISE TV.

Responding to UBA exposure to insider trading and lending to his other business interests, he said his oil and gas interests are financed by a consortium of other local and international banks excluding UBA and that other ventures have exposure below the threshold and the loans are serviced.

Elumelu said: “The oil and gas acquisition we just made, UBA did not participate in the funding. It is a club of international and local lenders. The local receiving bank for our proceeds is Union Bank of Nigeria and the international receiving bank of our oil sales is Standard chartered bank London. The transaction was funded by a consortium of banks Standard Chartered, ABSA IN South Africa, Afrexim, Union Bank, Fidelity Bank in Nigeria and a host of other international banks.

“So, we are minded of all this and we are very prudent in making sure we do not put pressure on the bank. We also put in equity investment and when we need to get investment, we try not to put pressure on the institution.

“What is important is that it is within the limit UBA should be exposed to a company and it is, by the way, performing very well. Our loans are performing very well.”

While objecting to comment on the recent events involving the CBN and First Bank board, He noted that the decisions made where appropriate and beneficial to all the major stakeholders involved and that the resolution is in sight.

Elumelu said: “You need to understand the unique situation of this question. I am chairman of a competing institution, United Bank for Africa and it may not be prudent for me to express a judgment or comment on this because it may not be very professional of me.

“But I know the shareholders of the bank and I also know the regulatory mindset and the regulators want a safe banking environment and I believe the shareholders also seek that in due course, I believe they would be able to resolve the issues. I must say the banking sector has done very well, both the regulatory part and the participants.”