DIAMOND BANK SHUTS DOWN UK BRANCH, N114BILLION BAD DEBTS UNDER ALEX OTTI'S MANAGEMENT STIFFLES OPERATIONS. MASS SACK IMMINENT, AS SHAREHOLDERS GRUMBLE

Diamond Bank Plc, one of the new generation banks in Nigeria has reportedly stopped granting loans to customers and has embarked on an aggressive debt recovery. Report has it that about N114billion non performing loans given out under former MD of the Bank Mr. Alex Otti is threatening operations of the Bank. The development has led to the gale of staff suspensions and dismissals. It was learnt that a senior management staff, one Sam Egube, has been relieved of his appointment with the bank as he was among those responsible for the precarious loan status of the bank.

Egube was alleged to have been involved in various non performing loans, it was said that the matter was widely-known in the bank that some refer to it as the “Egubegate”scandal. There are also reports that another top management staff,Lukman Agboola as well as other staff have been relieved of their jobs recently over their inability to recover loans that have become non-performing.

Inside source said that the loan that brought the wrath of management on Agboola and others was over N10billion doled out to a single customer without an impressive track record or traceable banking history.

The source added that “in some instances, some addresses of the companies were either incorrect or missing in their files. Some have phony directors that no one can account for. In fact, the bank has unleashed Interpol on some of the customers as part of the efforts to recover the loans”.
He alleged that “it is an indictment on the bank to declare such a bazaar; the quality of risk asset management is really poor and annoying”.

It was gathered that the loan situation has generated a lot of tension in the bank lately, as most staff are detailed to recover their loans as quickly as possible to avoid being sacked. However, those under investigation over allegations of compromise and insider aiding would be shown the exit, source said.

We gathered that the Bank would soon send some of it's staffs home, this month is very critical as most staff are under palpable anxiety as to whether they will continue in the bank or be laid off.
The Tsunami is imminent and staff can feel it. The new management is going to sack a lot of people because they say the overhead is enormous and the loan portfolio is huge; therefore there is this thinking that many staff may lose their jobs under the cloak of rationalization using appraisal as a guise, inside source stated.

They alleged that “only senior management staff approved those loans as they are members of the approving credit committee. They approved some of those loans for their friends and partners without collateral and now they want to drag us into the mud. If we have to suffer because of this, we may blow the whistle on other matters that may attract regulatory bodies”, the source added.

The fear of job losses in the bank is heightened by speculations that the bank would close down its subsidiary in London, Diamond Bank UK Plc. Meanwhile, shareholders are worried that the bottom-line of the bank and shareholders’ dividends will be adversely affected given the anticipated provisions for non performing loans.

Culled From The Citizen