[size=15pt]Islamic banking: Sanusi wows, divides Reps  [/size]

By John Ameh, Abuja   

Friday, 22 Jul 2011   

   

 
Governor of Central Bank of Nigeria, Mr. Lamido Sanusi, on Thursday rose in defence of Islamic banking before members of the House of Representatives, who, curiously, turned to clapping fans of the CBN governor.


The CBN governor had appeared before the House in answer to a summons to clarify questions on the controversial islamic banking and the lid on bank withdrawals.


Sanusi told the lawmakers that though Islamic banking system was founded on Islamic principles, it served all segments of the population and was not really about the religion.


He said there were advantages in the services of a bank that would neither charge interest on loans nor finance operations that society generally frown on.


He drew the attention of the House to the Banks & Other Financial Institutions Act, 1991, which made provisions for the introduction of non-interest banking in Nigeria.



He also told the lawmakers that the CBN never placed a limit on the amount anyone could withdraw but only directed that cash withdrawals in excess of N150, 000 for individuals and N1m for corporate customers would attract charges. He said the policy was established to enhance cash management by the banks and to drive Nigeria towards a cashless society in line with the global trend.


The CBN governor said he was amazed by the reactions which trailed the policy.


When Sanusi called for question after addressing the House for over one hour on the two issues, lawmakers did not ask him any question but engaged in intermittent clapping. At a point, some of the apparently ‘over- excited’ federal legislators gave Sanusi a standing ovation.


Chairman of the House Committee on Rules and Business, Mr. Sam Sokwa, said he was so impressed by Sanusi and that if he had his way he would make the CBN governor the president of Nigeria.


Some of the lawmakers however protested outside the chambers alleging indiscretion on the part of the Deputy Speaker, Emeka Ihedioha, who presided over the sitting.


He reiterated that the Islamic principles of financial transactions were introduced to the country as far back as 1991 and had gone beyond banking to insurance and the capital market. He said it was a non-conventional bank that did not charge interest on transactions.


“It is a bank that does not finance brewery, Indecency, casinos, prostitution and other moral or ethical issues,” he added.


He drew the attention of the House to the Banks & Other Financial Institutions Act, 1991, which made provisions for the introduction of non-interest banking in Nigeria.


According to Sanusi, what the CBN has done is merely to roll out guidelines for the operation of such banks as the regulator of the sector.


“It has nothing to with Sanusi, who became the CBN governor in June 2009 or the allegation that I am about to Islamise Nigeria and the CBN”, he argued.


He presented memos to the House indicating that his predecessor, Prof. Charles Soludo, approved for Nigeria to fast-track Islamic banking since 2008.


“I am only completing what had been started before Sanusi even became the governor”, he added.


Sanusi cited the United Bank for Africa, Intercontinental Bank and Chartered Bank as some of the banks which applied to start Islamic banking operations in 2008, a period he was not yet the governor.


“The tendency to view every single national policy on the basis of religion or ethnicity is not healthy for our country.


“Unfortunately, we the elite, we are guilty of this because we are not helping matters at all,” he told the lawmakers.


On the bank withdrawal controversy, Sanusi said, “Ninety-nine per cent of all those who have been speaking on this issue have never read the circular on this policy.


“Cash transactions represent over 99 per cent of our banking transactions; that is, people walking into a bank, picking cash and walking out.


“We are saying that if you choose to walk into a bank and withdraw N30million in a ‘Ghana-Must Go bag’, fine, we are saying that you to have to bear the cost. That is all.


“That service will not be rendered to you free of cost. Don’t we want to change this country?


“All the people complaining about cash withdrawal limits are the rich people, not the poor.”


According to Sanusi, statistics available to the CBN indicate that over 90 per cent of daily cash withdrawals by Nigerians are less than N100,000.


He added that only “a tiny 10 per cent” withdrew N150,000 and above a day, an indication that the poor majority were subsidizing the excesses of the rich few.


Sanusi argued that the rich who carried huge cash had the alternative of embracing electronic banking by using automated cards to transfer funds as well as order and make payment for services on line.


“But, if you insist on making cash withdrawals, we say you must pay. That is all”, he added.


He insisted that the policy had come to stay, adding that it was the projection of the CBN that the city of Lagos would become cashless by December this year.


Sanusi disclosed that around 60,000 POS terminals were being programmed for Lagos as one of the pilot cities for cashless transactions.


Ihedioha said all members were satisfied with Sanusi’s explanations and that questions were not necessary.


“We are satisfied; the CBN governor has offered satisfactory explanations.


“We are indeed enlightened”, Ihedioha ruled, ignoring some of the hands that were raised.


However, his action set the stage for protest by some lawmakers later outside the chamber.


They complained bitterly over the manner Ihedioha abruptly dismissed Sanusi without allowing members to ask him questions.


Leading the protest, the Minority Leader of the House, Mr. Femi Gbajabiamila, said that he was disappointed with the decision of the deputy speaker.


Gbajabiamila, a member of the Action Congress of Nigeria, from Lagos State, said, “I am disappointed totally.


“Are we in a classroom? That the CBN governor will just come and lecture us and walk away?


“Even in a classroom, students will seek for clarification after the teacher has rounded off his lecture.


“We live in a peculiar country where the various heterogeneous groups view every policy with mutual suspicion.
http://www.punchng.com/Articl.aspx?theartic=Art201107225421354

Lies

He said there were advantages in the services of a bank that would neither charge interest on loans nor finance operations that society generally frown on.

Nobody is paying attention,

Nobody is paying attention!!!

Is anybody hearing it?


At what point do we know what the nation frowns upon?

There is nothing legal that all Nigerians frown upon,


Reps were not allowed to ask questions? What sort of nation is this? Why is this happening? No questions allowed? Is anybody listening?

its done, no going back

Reps no fall our hands oo

Kudos to this ACN rep. He at least did his job.

As for Ihedioha? Well, I guess I was foolish to expect anything better from him

Chyz*:

He said there were advantages in the services of a bank that would neither charge interest on loans nor finance[b] operations that society generally frown on[/b].

hmmm society or islam?

That part made no damn sense.

Fine, prostitution is illegal. But a brewery? So his Islamic bank won't provide loan for brewery?

Nor indecency or casinos? The latter is not illegal in Nigeria to my knowledge.

Also no loans for pork?

This is why it pains me that the reps were not allowed to question him

Also annoying how he tries to make it out as if non-interest banking and islamic banking are the exact same thing. Bleh

ekt_bear:

That part made no damn sense.

Fine, prostitution is illegal. But a brewery? So his Islamic bank won't provide loan for brewery?

Nor indecency or casinos? The latter is not illegal in Nigeria to my knowledge.

Also no loans for pork?

I was wondering. Didnt realise we as a society had started frowning on the nigerian brewries and pork. Perhaps Sanusi can remind me whent that happened.

ekt_bear:

This is why it pains me that the reps were not allowed to question him

Because the goal wasnt to question him but a charade meant to copy what they see on CNN. Its a disgrace when elected representatives are too ignorant to probe government policy but spend the time applauding the person they are paid to monitor.

ekt_bear:

Also annoying how he tries to make it out as if non-interest banking and islamic banking are the exact same thing. Bleh

Of course, did his audience know any better?

its done. . .no going back. . .go sm00ch transformer

Muza:

its done. . .no going back. . .go sm00ch transformer

lol why? I dont live there anymore. You on the other hand enjoy the economic failure about to befall you.

davidylan:

lol why? I dont live there anymore. You on the other hand enjoy the economic failure about to befall you.

i'll be smiling to the Islamic bank wit so much pleasure to ur utter dismay.
dnt be ashamed later to come borrow some cash too, i'll forgive u by then,cos now its prolly cos of false alarm raised by some ppl dats why u shaking in ur boots. it will be well

Muza:

i'll be smiling to the Islamic bank wit so much pleasure to your utter dismay.
dnt be ashamed later to come borrow some cash too, i'll forgive u by then,cos now its prolly cos of false alarm raised by some ppl dats why u shaking in your boots. it will be well

these guys truly think allah's banks will turn around the country? Try pakistan.

ekt_bear:

That part made no damn sense.

Fine, prostitution is illegal. But a brewery? So his Islamic bank won't provide loan for brewery?

Nor indecency or casinos? The latter is not illegal in Nigeria to my knowledge.

Also no loans for pork?

This is why it pains me that the reps were not allowed to question him

Also annoying how he tries to make it out as if non-interest banking and islamic banking are the exact same thing. Bleh

Would you really approach a mortgage bank to fund your airline business?

or approach an agricultural bank to fund a software development company?

or a 'green bank' for a rocket propelled jet engine

how much does the pork/p0rn market contributes to the national gdp that it cannot get its loan from 24 other banks in the country
is Wema bank discriminating against the igbo by restricting its branches to the SW?

btw anybody seen the so called guideline or we've all been discussing based on what pastor James and the vanguard crew wrote

Dis Guy:

Would you really approach a mortgage bank to fund your airline business?

or approach an agricultural bank to fund a software development company?

or a 'green bank' for a rocket propelled jet engine

how much does the pork/p0rn market contributes to the national gdp that it cannot get its loan from 24 other banks in the country
is Wema bank discriminating against the igbo by restricting its branches to the SW?

btw anybody seen the so called guideline or we've all been discussing based on what pastor James and the vanguard crew wrote

THIS GUY, THANKS FOR SPEAKING MY MIND IN A MORE ARTICULATE MANNER.

Make God Punish this Emeka Ihedioha man. I can't believe this ignoramus represents my constituency abor-mbaise/ngor-okpala constituency. What a shame. The goon probably have connived with thes islamic elements to silence every potential dissenting views.
Ieeeediots! Only in Nigeria will a supposed educated federal lagislature use

Make God Punish this Emeka Ihedioha man. I can't believe this ignoramus represents my constituency abor-mbaise/ngor-okpala constituency. What a shame. The goon probably have connived with thes islamic elements to silence every potential dissenting views.
Ieeeediots! Only in Nigeria will a supposed educated federal lagislature use statements like; "we are enlightened". How demeaning can he further go to desecrate his office? What a lame brain!

Can someone direct the forum to a full guideline of how the banking system would work , so we can all make up our minds.
I have a Problem with calling it Islamic banking, because I'm sure Christians also frown on
: prostitution , alcohol and what not. Why don't we call it religious banking.

why is mallam so interested on the islamic banking?? is this guy really working for nigeria or is he working for the al-queda group from the north i hate northerners.

The bokos have started robbing and attacking banks not operating on islamic principles. What will happen when the islamic banks start operating in full?

Dis Guy:

Would you really approach a mortgage bank to fund your airline business?

or approach an agricultural bank to fund a software development company?

or a 'green bank' for a rocket propelled jet engine

Err? If I need a mortgage loan, car loan, education loan, business loan, etc, etc, I'll go one single banking organization for that (in my case, BoA.) Loan is loan, there is no real reason to go to different sources for it.

At least where I live, banks are one-stop-shots for credit.

how much does the pork/p0rn market contributes to the national gdp that it cannot get its loan from 24 other banks in the country

Its contribution to GDP is irrelevant. The point is, he is pushing a bank that has some sort of "moral" code that differs from that of the constitutution. Why can't I make a bank that won't loan money to Igbos, for example?

is Wema bank discriminating against the igbo by restricting its branches to the SW?

No Igbos live in the SW zone? Is this your claim? Anyway, there is nothing discriminatory about being a regional bank. Unless you think a pure waster business/bakery that only operates in a single town is also discriminatory

ekt_bear:

Err? If I need a mortgage loan, car loan, education loan, business loan, etc, etc, I'll go one single banking organization for that (in my case, BoA.) Loan is loan, there is no real reason to go to different sources for it.

At least where I live, banks are one-stop-shots for credit.

Where I live banks have one stop service and some have specific targets, it's all about options

If Standard Bank has a window for islamic banking, How does that disturb my business with them?

Its contribution to GDP is irrelevant. The point is, he is pushing a bank that has some sort of "moral" code that differs from that of the constitutution. Why can't I make a bank that won't loan money to Igbos, for example?

it's not tax payers money, it's a license. the law of the land is derived from some sort of moral/religious code.
In what way does it differ from the constitution? No one on Nairaland or even Vanguard newspaper have been able to point this section of the constitution.

No Igbos live in the SW zone? Is this your claim? Grin Anyway, there is nothing discriminatory about being a regional bank. Unless you think a pure waster business/bakery that only operates in a single town is also discriminatory

so if a bank decide its only lending money for agricultural related business is that discriminatory?

Dis Guy:

Where I live banks have one stop service and some have specific targets, it's all about options

Agreed. But these niche banks are well. . . niche banks. They don't get a significant amount of business, so are arguably not that important to the banking sector.

If Standard Bank has a window for islamic banking, How does that disturb my business with them?
it's not tax payers money, it's a license. the law of the land is derived from some sort of moral/religious code.
In what way does it differ from the constitution? No one on Nairaland or even Vanguard newspaper have been able to point this section of the constitution.

In theory I wouldn't care, but we don't live in theory. We live in Nigeria Sanusi has some sort of agenda behind this. Or at least so I believe.

so if a bank decide its only lending money for agricultural related business is that discriminatory?

So fine, agricultural bank that specializes in loans for agric products. So Islamic bank that only gives loans for Islam-approved purposes. You think these two things are equivalent? I'm not making any assumptions, just trying to get a sense of how you think.

I wonder why some Ibos prefer to be used by Hausa/Fulanis. Imagine Ihedioha staged to preside over this controversial issue and he delivered to them. I wonder.

These hausa fulani people think they are wise, well it is working for them just that people like us that are reading their games will not be taken seriously. When they want to achieve controversial issue, they will ask an Ibo to preside and they will back him.

Most Ibos are fools and stooges

sirjec:

I wonder why some Ibos prefer to be used by Hausa/Fulanis. Imagine Ihedioha staged to preside over this controversial issue and he delivered to them. I wonder.

These hausa fulani people think they are wise, well it is working for them just that people like us that are reading their games will not be taken seriously. When they want to achieve controversial issue, they will ask an Ibo to preside and they will back him.

Most Ibos are fools and stooges

Definitely Emeka Ihedioha or whatever the clown calls himself is not representative of his 99.9999% christian contituency, he's an aberration to democracy.
However, notice the way northern extremist religious politicians use their southern counterparts to support their bigotted agenda; I remember how Bankole almost twarted the swearing-in of GEJ when Yar'dua was brain dead in Aso rock. I don't see an Igbo or Yoruba thing, I see a tendency for our southern politicians to "serve" their northern masters well.

Also see, write by Osahon:
https://www.nairaland.com/nigeria/topic-720087.0.html

sirjec:

I wonder why some Ibos prefer to be used by Hausa/Fulanis. Imagine Ihedioha staged to preside over this controversial issue and he delivered to them. I wonder.

These hausa fulani people think they are wise, well it is working for them just that people like us that are reading their games will not be taken seriously. When they want to achieve controversial issue, they will ask an Ibo to preside and they will back him.

Most Ibos are fools and stooges

it has nothing to do with igbo or hausa/fulani

it is a national agreement by people of both Christian and Muslim background

LOL at Ihedioha, Planning ahead of 2015 target.

I support Islamic banking though, I however expected that Ihedioha would have allowed questioning of the CBN governor.