The Central Bank of Nigeria (CBN) said on Friday that HSBC and UBS Nigeria had closed their representative offices. No reasons were provided.
Their closures come after news that foreign direct investment (FDI) into Nigeria has fallen from a year ago. FDI into Nigeria totalled 379.84 billion naira ($1.2 billion) in the first half of 2018 compared with 532.63 billion naira ($1.7 billion) a year earlier.
HSBC had recently become mired in the country’s political debate. An analyst at the bank recently warned that a second term for president Muhammadu Buhari, who is seeking re-election in February 2019, may stall economic recovery. A presidential spokesperson hit back accusing HSBC of money laundering.
A Nigerian investigation alleged HSBC had been involved in former military dictator Sani Abacha’s efforts to launder $100 million. HSBC has not commented on the accusation.
Representatives from HSBC speaking at PBI London in 2015 said that Africa should be a key focus for the industry citing a UN forecast where Africa’s population is set to account for 40% of the world’s population by 2100.
UBS began efforts to expand its private banking and wealth management services in the country in 2013 after reports revealed that the country’s wealthy population was also surging.
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In a ruling that has rattled many foreign investors, South African telecoms company MTN was ordered to return $8.1bn of “illegally” repatriated dividends back to Nigeria.
UBS and HSBC declined to comment on the closing of their offices. Both banks had opened representative offices in Lagos, the country’s commercial capital.