MTN’s share price plunged more than 20 percent on Thursday after Nigeria’s central bank ordered the telco’s bankers to return $8.1 billion which they had repatriated on behalf of the company.
In a statement on Wednesday, the Central Bank of Nigeria (CBN) announced a fine of N5.65 billion ($15.58 million) on four banks for breaching Nigeria’s forex regulations on illegal capital repatriation by telecommunications company MTN. The regulator also directed the banks to refund a total of $8.134 billion which MTN took out of the country through the banks.
MTN denied any wrongdoing.
“No dividends have been declared or paid by MTN Nigeria other than pursuant to certificates of capital importation issued by our bankers and with the approval of the CBN (Central Bank of Nigeria) as required by law,” the telco said in a statement.
The company’s stock went down 20.25 percent to R85.60 at 08:33 GMT.
While Nigeria is MTN’s most profitable market, regulatory challenges faced in recent times leaves a bad taste and raise concerns over the company’s future in the country. Recall that the telco had agreed to pay $1 billion and list on the Nigerian Stock Exchange to end a dispute over MTN’s failure to disconnect some improperly registered SIM cards.
Meanwhile, the rand traded 0.52 percent weaker at 14.4325 per dollar, early Thursday, as the currency falls alongside other emerging market currencies, with deep concerns that settlement of the trade war between the United States and China might be derailed by the NAFTA deal signed this week by the US, with Mexico and Canada.
Reuters reported that stocks would open lower, Thursday, with the JSE securities exchange’s Top-40 futures index down 0.44 percent.