Fake News, Rumours and state of play at Polaris Bank, By Kirk Leigh


By Kirk Leigh


Rumours can wreak havoc. Deadly whispers and baseless news have toppled strong Banks in advanced countries like United Kingdom, United State of America, Germany among others causing systemic crises in their financial systems. Alarmingly, similar rumours are now swirling around Nigeria’s financial sector. These dangerous falsehoods must be immediately dismissed and condemned by well-meaning Nigerians to safeguard the stability of our banking system.

Given the harmful effects of such rumours on the financial system, we should all be worried that on the heels of the unfortunate incident of withdrawal of the banking licence of Heritage Bank, peddlers of fake news and rumour mongers dusted up an old directive of the Central Bank of Nigeria (CBN) dated January 10, 2024, that mandated a change in the boards of Union Bank, Keystone and Polaris Bank. In re-purposing an old story, the mischief makers twisted it to suggest that the operating licenses of these banks are going to be revoked by the CBN. They even urged Nigerians to make haste and withdraw their funds from these banks to ‘save’ their money from being trapped.

But sensing the ominous signs and overall threat of the dastardly hearsay on the financial system that it has carefully nurtured and safeguarded over the years, the CBN was quick to debunk the rumours for what they were – fake news.

Through its Acting Director of Corporate Communications, Mrs Hakama Sidi Ali, the apex bank affirmed that it has no plan to revoke the licences of any other banks and that the rumours should be disregarded.

She pointedly noted that a circular issued by CBN on January 10, 2024, notifying the public about the dissolution of the boards of Union, Keystone, and Polaris Banks, was being re-circulated by individuals with untoward and shady agenda, as though it was issued on June 10, 2024. She blamed unscrupulous people for the development aimed at creating panic in the banking system.

She assured that the withdrawal of Heritage Bank’s licence which triggered the vile tongues, was an isolated case, adding that allegations of further revocation of licences before the completion of the banking recapitalisation exercise, were mere fabrications of those who do not wish the banking sector well.

The CBN further reassured the banking public of the safety of their deposits stressing that the banking system is resilient. The CBN, therefore, urged the public to continue their regular banking activities without concern, dismissing any false reports regarding the health of specific Deposit Money Banks.

Indeed, the CBN realizes that without these Banks, there would be a systemic failure that would have far-reaching effects on the economy; how catastrophic would that be in an economy characterized by weak growth, low purchasing power and spiralling inflation? The results would be nothing short of seismic. It will amount to the system losing a cumulative of over N9 trillion in assets, and more than N7 trillion in customer deposits; a very big loss that will most definitely shake up the system given the interconnections of the financial system.

Among the Deposit Money Banks targeted in the campaign of Calumny is Polaris Bank which, despite macroeconomic challenges, has consistently demonstrated resilience. At the latest audit, Polaris Bank, for instance, was literally on fire in terms of deposit mobilization, which it pumped from N1.14 trillion to N1.76 trillion, a 54 percent improvement over the previous year. If anything, it is a testament to the Bank’s attractiveness to the banking public. It was a year that the bank also jerked up gross earnings to N121 billion from N197 billion, up by 62 per cent and sustained profitability year on year since its emergence in 2018. Why would anyone wish anything untoward for such a bank? Why would a faceless interest hide in the shadows to pull strings against such a stellar performer? It does beat the imagination.

In a continuous demonstration of its contributions to economic growth, the bank has grown its loan book by 138 percent i.e. from N261 billion in 2019 to N622 billion in 2023. One of the key areas is the micro small and medium enterprises (MSME). It is an established fact that access to capital is a major inhibitor to economic growth in Nigeria. This underscored the importance of Polaris Bank’s intervention in providing cheap capital for the MSME sector.

The Bank’s intervention didn’t take long to be noticed as Polaris Bank was declared ‘MSME Bank of the Year’ consecutively in 2021 and 2022 in what the organisers described as the bank’s expansive impact on MSME operators across Nigeria. Polaris Bank had in May 2022 launched an N1 billion fund for MSMEs in partnership with Lagos State Employment Trust Fund (LSETF) in what was aimed at providing the much-needed funding to create wealth and empower entrepreneurs and players within the MSME space in Nigeria, starting with Lagos. Before the launch of the N1 billion MSME Fund, Polaris Bank had committed, and indeed, continued to provide multi-billion financing to MSME operators across sectors, health inclusive among other incentives. But the BusinessDay and other Financial Institutions Award (BAFI) s not the only recognition that the Bank has won. The Bank’s digital prowess was recognised by three awards; the Nigeria Fintech Award where it was awarded the Best Digital Bank: VULTe; Business Day Awards as the Best Digital Bank of the Year and the African Digital Bank of the Year by the African Leadership Award. These awards, in quick succession, cemented the place of Polaris Bank as a futuristic Bank. Then there was also the Nigeria Healthcare Excellence Awrds (NHEA) for Outstanding Healthcare Financial Institution of the Year for a truly outstanding Bank.

Here is a Bank that is truly in tune with the community as it has engaged in various social responsibility activities, particularly focusing on education and empowerment such as girl-child education; empowerment projects; and sustainability interventions.

On girl-child education, Polaris Bank has partnered with Evolve Charity to support the education of underprivileged girls. This initiative involves providing essential school supplies such as uniforms, bags, pens, sandals, and books to schools in Lagos, Abuja, Kano, Kogi, Rivers, and the Imo states. The goal is to keep girls in school and reduce early marriages by empowering them through education.

In the aspect of empowerment projects, the bank’s support extends to training and development programmes aimed at enhancing skills and providing opportunities for young girls. These projects are part of the broader commitment to advocate for girls’ rights and provide them with the tools needed for personal and academic success.

On sustainable education interventions, Polaris Bank, in collaboration with Evolve Charity, in the past four years has adopted several schools across the country, ensuring continuous support by providing educational supplies and teaching value-based education to promote good manners among students.

These initiatives reflect Polaris Bank’s dedication to contributing positively to society, focusing on long-term impacts through education and empowerment.

It becomes foolhardy to base one’s dealings with Polaris Bank and indeed the other three banks on mere hearsay and misinformation in the banking sector. As witnessed in global financial crises, baseless speculations can incite panic and trigger catastrophic runs on otherwise stable institutions. The CBN’s prompt response to dispel these fabrications reaffirms the importance of transparency and vigilance in safeguarding the integrity of the financial system. Amidst these challenges, institutions like Polaris Bank stand as beacons of resilience and commitment to societal progress, exemplified through their robust financial performance, dynamic and reliable digital technology platform and impactful initiatives in empowering communities, particularly in education and entrepreneurship. Moving forward, collective efforts to combat misinformation and uphold trust are imperative to ensure the stability and prosperity of Nigeria’s financial landscape.


Kirk Leigh, a Financial and Economic Analyst, Policy commentator and Publisher, AbujaPolitico wrote from Abuja.