MTN Refutes Central Bank of Nigeria Allegations and $8 Billion Claim

"The re-emergence of these issues is regrettable as it damages investor confidence and, by extension, inhibits the growth and development of the Nigerian economy," MTN informed investors.

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Remera On the wall in Kigali, Rwanda, is a yellow advertisement of the telecommunication company MTN,which is one of the biggest in East Africa.(Photo Credit: Andreas Marquardt / Shutterstock.com)
Remera On the wall in Kigali, Rwanda, is a yellow advertisement of the telecommunication company MTN,which is one of the biggest in East Africa.(Photo Credit: Andreas Marquardt / Shutterstock.com)


MTN, Africa’s largest mobile phone operator, has refuted allegations that certificates of capital importation issued in respect of the conversion of shareholder loans in MTN Nigeria to preference shares in 2007 had been improperly issued.


“MTN Nigeria strongly refutes these allegations and claims,” the operator informed investors on the JSE on Thursday morning.

“No dividends have been declared or paid by MTN Nigeria other than pursuant to Certificates of Capital Importation (CCI’s) issued by our bankers and with the approval of the CBN as required by law,”

The company confirmed that its Nigerian operation received a letter on 29 August 2018 from Central Bank of Nigeria alleging that CCI’s issued in respect of the conversion of shareholders loans in MTN Nigeria to preference shares in 2007 had been improperly issued.

As a consequence they claim that historic dividends repatriated by MTN Nigeria between 2007 and 2015 amounting to $8,1 billion (R115 billion)  need to be refunded to the CBN.

The mobile phone operator said issues surrounding the CCI’share already been the subject of a thorough enquiry by the Senate of Nigeria.

“In September 2016 the Senate mandated the Committee on Banking, Insurance and other Financial Institutions to carry out a holistic investigation on compliance with the Foreign exchange (monitoring and miscellaneous) Act by MTN Nigeria & Others,” the company said.

“In its report issued in November 2017, the findings evidenced that MTN Nigeria did not collude to contravene the foreign exchange laws and there were no negative recommendations made against MTN Nigeria.”

MTN Nigeria, as a law-abiding citizen of Nigeria, is committed to good governance and to abiding by the extant laws of the Federal Republic of Nigeria, the company said.

“The re-emergence of these issues is regrettable as it damages investor confidence and, by extension, inhibits the growth and development of the Nigerian economy,” MTN informed investors.

“We will engage with the relevant authorities and vigorously defend our position on this matter and provide further information when available. Shareholders are accordingly advised to exercise caution when dealing in the Company’s securities until a further announcement is made.”

Reuters reported on Wednesday that Nigeria Central Bank ordered four banks to refund $8.1 billion MTN sent abroad.

The Central Bank of Nigeria has also fined the banks, it said on its official Twitter account, although the fines are small compared to the demanded refund.

Standard Chartered was fined 2.4-billion naira ($7.86m), Stanbic IBTC Bank 1.8-billion naira, Citibank 1.2-billion naira and Diamond Bank 250-million naira.

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