Reports by Businessday suggest the Central Bank of Nigeria (CBN) may have asked the senior management of payment processor e-Tranzact Plc to step down. The executives affected include the Managing Director Valentine Obi and two executive directors Sullivan Akala and Ike Eze.

Others are Chief Technology Officer (CTO) Richard Omoniyi and Chief Operating Officer (COO) Kehinde Segun.

In addition, the apex bank has reportedly ordered Pricewaterhouse Coopers and Ernest and Young to conduct an audit of the firm’s accounts.

Why did the CBN take this step?

Michael Obasuyi Managing Director of Smart Microsystems had sent a petition to the Economic and Financial Crimes Commission (EFCC) accusing the company of fraud.

In response, the firm sent a counter-petition to the anti-corruption body accusing Obasuyi of fraud.

Investigations by the anti corruption body revealed Obasuyi had defrauded a bank of N11 billion using E-Tranzact’s platform.

In addition, the apex bank has reportedly ordered Pricewaterhouse Coopers and Ernest and Young to conduct an audit of the firm’s accounts.

Implications of the action

While the company is yet to issue any notice to the Nigerian Stock Exchange (NSE) relating to this, the bourse could decide to place the company’s shares on full suspension pending more clarity. Full suspension means there will be no trading in the company’s shares, and its price remains unchanged.

The company’s results for the first quarter ended March 2018 show revenue increased from ₦2.8 billion in 2017 to ₦3.3 billion in 2018. Profit before tax, however, fell sharply from ₦190 million in 2017 to ₦91 million in 2018. Profit after tax also dropped from ₦129 million in 2017 to ₦62 million in 2018.

e-Tranzact international was incorporated as a Private Limited Liability Company on the 7th of May 2003. It became a public limited liability company on the 7th of August 2009 and was quoted on the Nigerian Stock Exchange (NSE).

The majority shareholder of the company is Virgin Island based eTranzact Global, with a 50.3% shareholding.

The company is into real time settlement of transactions using multi channel electronic payment system.

E-Tranzact closed at ₦4.55 in today’s trading session.

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