There are strong indications that the Delta State Government in 2007 offered its 820 million units of shares in Oceanic International Bank Plc to Ascot Offshore Nigeria Limited to secure loans from Intercontinental Bank Plc. A recent debtors’ list published by the Central Bank of Nigeria put Ascot’s debt with the bank at N44.6bn. It was learnt that the deal was struck during the tenure of Chief James Ibori as the state’s governor.
Ascot’s loan is part of the N748bn non-performing loans of five banks whose chief executive officers were removed by the Governor of Central Bank of Nigeria, Mr. Sanusi Lamido, on August 14. Documents detailing the transaction and linking the state government to the deal were obtained by our correspondent on Tuesday (yesterday).
One of them is a letter dated January 12, 2007 and signed by two directors in the Delta State Ministry of Finance. Although the names of the directors are not indicated on the document, a reliable source at the Central Bank of Nigeria said investigations had shown that the Delta State Government pledged shares in Oceanic Bank, owned by the government, as collateral for the loan that Ascot took from Intercontinental Bank. Our correspondents gathered that the senior government officials, who must have acted under the instructions of their superiors, might have chosen not to use their names in order to play safe. The state government’s letter was addressed to the General Manager, BFCL Assets and Securities Limited, UBA House (5th Floor) 57 Marina, Lagos for the Attention of one S.D. Lelekumo. The letter is titled, “Letter of Authority,” and it reads, “Ascot Offshore Nigeria Limited was recently granted some credit facilities by Intercontinental Bank Plc and have approached us to assist with collateral in accordance with
the conditions of the offer. “We have acceded to their request and hereby authorise you to cause a lien to be placed on our 820 million units of Oceanic Bank Plc shares with you in favour of Intercontinental Bank Plc.” A similar letter was written on the same day to the managing director of Consolidated Investment Limited in respect of 36,010,243 units of Oceanic Bank Plc shares. In response to the instruction from the Delta State Government, BFCL, on January 24, 2007, wrote to the managing director, Central Securities Clearing System Limited, Lagos authorising it to place a lien on 492,000,000 units of shares out of the 820 million units of Delta’s shares with Oceanic Bank. The letter reads, “We have been instructed by the Delta State Government to place a lien on their holdings of Oceanic Bank International Plc shares as a result of a loan facility granted to one of their subsidiaries: Ascot Offshore Nigeria Limited by Intercontinental Bank Plc. “Consequently, we hereby request that you place a lien on 492,000,000 units out of 820,000,000 units deposited in CSCS Account Number 36205685 with us as collateral for the loan facility. “In the light of the above, we wish to state that we do not have any objection to the placement of a lien on 492,000,000 units of Oceanic Bank International Plc shares.” The letter was signed by Mr. Alex Olunwa, a manager in charge of Capital Market Operations and Mr. Samson Lelekumo, a senior manager. It was copied to Intercontinental Bank. Two other letters dated January 12 from the ministry of finance on the transactions, were also forwarded to the Director-General, Nigerian Stock Exchange and the Managing Director, Central Security Clearing System Limited, Lagos. The NSE D-G’s letter was titled: Ref: Short loan- irrevocable instruction to sell share.
It reads, “We write to put you on notice that we have given our irrevocable instruction/authority to Intercontinental Securities Limited, to sell all the shares under its domain and which we have pledged as security for the loan availed us without further recourse to us and that the proceeds be applied to repay all or part of the loan plus accrued interest and charges.” Chairman/Chief Executive Officer of Ascot Offshore Limited, Mr. Henry Imasekha, is alleged to be Ibori’s associate. Other directors of Ascot are Mr. Steve Judd (Managing Director/Chief Operating Officer); Mr. Emmanuel Nwachukwu (Executive Director/Chief Financial Officer); Mr. Joey Obue (Executive Director/Chief Business Development Officer); and Chief Joseph Penawou.
Efforts to speak with Imasekha on Tuesday were unsuccessful as a company official, who sought anonymity because he was not authorised to comment on the matter, said Imasekha was abroad. Also, several calls to BFCL’s office telephone lines were not picked as at 5pm. Attempts to get the Delta State Government to react failed as the state’s Commissioner of Information Mr. Omah Djeba, said he was in New York, United States. “My appeal is that I am outside the country; I am in New York. Find out from the Commissioner of Finance or the Chief Press Secretary to the Governor (Mr. Sunny Ogefere), at that time.” Also, attempts to speak with the Chief Press Secretary to the Governor did not yield any result as he failed to pick his calls twice. But a text message sent to him read thus: “I called twice to get to the state’s reaction to its role in getting collateral for Ascot in 2007. Mr. Omah Djeba is in New York and he has asked me to get in touch with you.”
However, he did not reply as at 7pm when this report was filed. The CBN source expressed dismay at the action of the Delta State Government of the time, adding that pledging a state government’s asset as collateral for a private loan is an offence. He said, “If the governor has no interest in the loan, why should he use a state asset to collaterise it? The share price of Oceanic Bank has dropped from about N30 per share at the time to below N5 now.
"Whoever is involved has erred in three areas - conversion of a public asset to private use; loss of value to Delta State people, because about N12bn has been lost by the state government as a result of the drop in share value. Again, the fact that the loan that was taken has not been repaid is another problem.” The official said that nobody could pledge those shares without the governor‘s authorisation.
"What I think the EFCC would do would be to pick the Commissioner for Finance up, then he will be forced to say who is involved,” the source said.
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