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Wednesday, September 23, 2009

Intrigues, fear hit banks amid crisis


Nation awaits audit of 11 banks

Security cash in on crisis

CBN appoints EDs for 'troubled banks'

By Ade Ogidan, Business Editor with Enitar Ugwu and Adeyemi Adepetun
LIKE a disturbed beehive, the banking sector has hit a high note of disquiet, with fears elicited by a cocktail of intrigues in the on-going reforms, doubts over the jobs of all cadre of staffers and uncertainty over the fate of directors.

In addition, certain security agencies are now being accused of being recipients of gratification in the desperation of some debtors or bank chiefs to have their problems hushed up.

Also, names of bad debtors, if published at all, may not be done in full, even as the debt stock uncovered in the audit exercise conducted on the remaining 11 banks, excluding the three largely foreign-owned, has revealed a level that far-outstrips the discovery in the troubled five banks. The possible non-disclosure of the debtors is believed to be due to the prominence of top political office holders on the list.

The bad loan saga has reportedly implicated operators at high levels of the nation's leadership, including past and serving governors, ministers and legislators.

Family members of some of the nation's top office holders have also been found to be involved in the brisk business of influence for cash, which the industry has become. Indeed, a lady married to a governor and also close to the seat of federal power, was named as a go-between in some of the deals.

These influential persons were specifically mentioned as the ultimate brokers, introducing the banks to government agencies and officials, on mouth-watering commissions.

Analysts have started sieving through the maze of intrigues that have dogged the banking industry since last year, seven months before the exit of Prof. Chukwuma Soludo as Governor of Central Bank of Nigeria (CBN) and the succession exercise.

A top government official, who spoke with The Guardian, said the real mega debtors are yet to be mentioned and may never be publicly listed.

He said: "It has already been discovered that the non-performing loans are astronomical, especially the ones incurred by the 'untouchables'. Figures have shown that the discovery in the five troubled banks is not more than 10 per cent of the total stock."

Another official also said that the ongoing debt recovery exercise has been tainted by mega bribery, with top officials of some security agencies rollicking on the windward side of the scam.

There was the case of a gentleman and his company who are owing a bank tens of billions. The bank allegedly paid a substantial amount of money in foreign currency to some security agencies' officials to help compel him to pay once he was apprehended after a long time of his failure to pay. The man, The Guardian learnt, merely induced the officials with an extra 50 per cent of the said amount and he was released, under the pretext of following due process of arrest and prosecution. He is now reportedly at large.

The source continued: "Nobody is also talking about the high indebtedness of a particular former governor, which was incurred either directly or through his proxies, some of who are now already known", he said. On a more worrisome note, another source disclosed that the N747 billion now being talked about by the CBN is a mere 10 per cent of the bad loan profile in the 24 banks.

"The total problematic loan portfolio in the industry is about N8 trillion. So, the N747 billion being talked about is just a mere 10 per cent."

The CBN governor, Sanusi Lamido Sanusi, is also being urged to announce, in the spirit of his avowed full disclosure regime, the amount spent to print the N420 billion injected into the five troubled banks, even as official sources put the current printing expenditure at N100 billion.

To ensure a hitch-free operation, the Central Bank of Nigeria (CBN) has appointed Executive Directors (EDs) for the five banks whose managing directors it recently sacked.

This is in line with the pronouncements by the CBN governor, Sanusi Lamido Sanusi, when he announced the removal of the managing directors.

The five banks, which got the new executive directors are Intercontinental Bank Plc, Oceanic International Bank, Afribank Plc, Union Bank Plc and Finbank Plc.

For Afribank, the new EDs are Mr. Stephen Adaji (Executive Director- Operation (OPS) & Information Technology (IT), Human Capital Management and Corporate Support), Joke Giwa Director Retail, Commercial and Corporate Banking), Mr. Nnamdi Christopher Anammah (Institutional Banking), and Mr. Isaac Kamaru Alofoje (Risk Management, Strategy, Remedial & Control).

Giwa, until her appointment, was a country Head, retail banking in Ecobank Plc; while Alofoje was until his appointment also, deputy managing director of Financial Derivatives Company Ltd. Anammah was the President/CEO of Prudential Trust Company Ltd. while Adaji retired from Bank of Industry (BoI) in 2005.

For Finbank, the CBN was reported to have appointed three executive directors with one of the newly-appointed said to have come from First City Monument Bank (FCMB), while the second appointee is from Diamond Bank Plc, and the third a staffer of United Bank for Africa (UBA) Plc subsidiary.

However, their names are being kept under wraps to enable them get clearance from their various banks or their current employer, The Guardian has learnt.

According to sources, the CBN also appointed four executive directors for Intercontinental Bank Plc and Oceanic International bank Plc respectively but their names were yet to be disclosed.

For Union Bank Plc, the newly-appointed executive directors are Philip Ikeazo, Director (wholesale banking), UBA; Ibrahim Abubakar Kwargana, First Bank deputy general manager and Business Development, Abuja; Adekunle Adeosun; Director, Group Treasury Sales, UBA and Ade Shonubi, director, Information Technology (IT) and Corporate Services, Renaissance Security Ltd.

It is expected that all the named executive directors for the five banks will resume duty today.