Sierra Leone closes only privately owned indigenous bank

Sierra Leone’s central bank on Wednesday shut down Union Trust Bank (UTB), the West African country’s only privately owned indigenous bank, declaring it insolvent after years of failed recovery efforts.

It determined UTB no longer met the statutory requirements to operate as a licensed commercial bank after extensive supervisory measures over the past five years, Bank of Sierra Leone governor Ibrahim Stevens told reporters.

Rokel Commercial Bank, majority-owned by the state, has acquired UTB under a purchase and assumption arrangement, bringing an end to the 31-year-old institution.

The closure drew swift criticism from shareholders, who described the decision as “premature and unnecessarily harsh” and called for the bank to be returned to its owners.

Shareholders disputed the central bank’s assessment, saying they had secured the capital required to recapitalise the lender through a Sierra Leonean investor.

They said they had submitted the relevant documentation to regulators, informing them the capital requirement had been met.

Shareholders have sought legal redress through the courts to challenge the regulator’s actions, but they said the proceedings had yet to make progress.

Reuters