THE NATION

http://thenationonlineng.net/web2/articles/16226/1/Sanusi-denies-hidden-agenda-/
 

August 29, 2009

Sanusi denies hidden agenda •

By Sam Omatseye • Published Today • News •
Rating: Unrated

Central Bank Governor Sanusi Lamido has denied that his reforms and firing of
five bank chief executives were part of a hidden agenda to hand over the banks
to an oligarch of northern investors.

He made this clarification in London on Friday to some Nigerian editors after he
fielded questions in a town hall meeting with correspondent banks, members of
the diplomatic committee, investors and journalists, amounting to over 200
persons. The interim CEOs of the five banks involved in the August 14 shake-up
attended the town hall meeting.

"I don’t understand what this north and south thing is all about," he said with
a monotone but occasionally stressing his points with hand gestures. "The agenda
I have is to ensure corporate integrity of the financial institutions in
Nigeria."

Lamido said the banks are Nigerian banks with Nigerian staff with branches all
over Nigeria, stressing that the CBN is not a northern institution.

In a response to a question as to why the news report predicted his actions,
including the specific number of banks, the firings, the intention to sell them,
he said wryly "maybe they are prophets."

He noted that, "If you insist that I have a hidden agenda, I cannot prove that I
don’t have a hidden agenda."

He said time would vindicate him. He said his job is statutory, and he undertook
the actions on those five banks not as selective measures, but these were the
banks that manifested stress in terms of illiquidity, lag in corporate
management and non-performing loans.

He said the case of Union Bank was a surprise but they discovered that it showed
great vulnerability in the inter-bank market. He responded to the charge from
Oceanic Bank that he had approved the bank's move to release its 2008 results.

He said Mrs. Cecillia Ibru had met him in one of the meetings with bank chief
executives and requested him to allow her release the company earnings because
of shareholder pressure.

Sanusi said he resented the release since she wanted to pay dividends as the
bank was running low on money. Then she agreed not to pay dividends. The
governor said he allowed her to release it on the caveat that after the
examiners had finished there would be adjustments based on the investigation of
its finances.

The CBN governor also said he received calls after the August 14 shake-up why he
did not fire other CEOs like Jim Ovia and Elumelu. He said he only acted on the
facts and not sentiment.

He reiterated that he would release the results of the investigations of the
other 14 banks in September. He denied ruling out firing any other bank chief
executive if new infractions were detected.

During the town hall meeting at the Andaz Hotel in London, the CBN governor, in
dark three-piece suit and familiar bowtie, fielded questions after unveiling the
state of the Nigerian banking sector and the overall health of the Nigerian
economy. The presentation was titled, "The current state of the Nigerian economy
and the developments in the banking system."

The main thrust of the question focused on the resilience of the banking sector
and their ability to honour their obligations in the international banking
system.

The CBN governor said if any bank defaulted, the CBN would honour its
obligation, while reiterating that the banks are strong enough to meet financial
transactions all over the world.

He said the Nigerian economy witnessed five percent growth in the first half of
this year and will witness the same level of growth for the second half. He said
this happened in spite of the Niger Delta crisis, the absence of power and
failures of infrastructure. He said once these matters are put in place Nigeria
could record doube-digit growth. He noted that with the amnesty plan already
working, the economy may be set to turn the corner.

He also said given the population, he would not forclose the establishment of
smaller banks like regional banks, specialised banks and even Islamic Bank,
which he said were not original ideas to him. Those ideas, he said, were already
under discussion years before he ascended the position as governor.

Chairman of Stanbic IBTC, Mr. Atedo Peterside, introduced the CBN governor in a
speech that rippled with criticisms of former CBN governor, Prof. Charles
Soludo. He accused Professor Soludo of enforcing a regime of non-disclosure even
though he knew the banks were in danger of collapse.

He said Prof. Soludo "threatened sanctions against any bank CEOs whose staff
dared to make reference to this ‘open secret’ that the capital of a handful of
Nigerian banks was almost completely eroded."

Deriding him as "an emperor who had no clothes on" who "insisted that he was
fully clothed," he said that the former CBN governor did not show respect for
full disclosure.

"They called this "de-marketing of the competition and even turned the clock
back on greater financial disclosure and transparency."

He cast the mind of the audience back to the open letter he wrote to Prof.
Soludo when he was appointed into office, saying he was "trying to do far too
much and far too soon," and "…swinging from one extreme to another, and that is
very dangerous