Sanusi Incompetent To Manage CBN? - Business (9) - Nairaland
Nairaland Forum / Nairaland / General / Business / Sanusi Incompetent To Manage CBN? (10103 Views)
President Buhari Is Confused And 90% Of His Ministers Are Incompetent / A Sample Of Sanusi New 200 Naira Note / Sanusi Incompetent To Manage Cbn •‘if I Were His Employer I Won’t Retain Him (2) (3) (4)
(1) (2) (3) ... (6) (7) (8) (9) (Reply) (Go Down)
| Re: Sanusi Incompetent To Manage CBN? by Remii(m): 10:36pm On Dec 12, 2009 |
Methink Sanusi is doing a great job, sentiments apart. This week those failing banks declared losses up to N1.5trillion and more are still coming. The prices are crashing but that gives opportunity for those of us that bought Oceanic at N27 to buy at N1 or even 50k and average down Naira cost per share, it is mixed situation but it is better to know the real situation of things than the falsehood that reigned in the market in the past. Bumper could be in the way next year if the losses provided for are recovered and the bank become more prudent in their business practices. |
| Re: Sanusi Incompetent To Manage CBN? by vislabraye(m): 12:49am On Dec 13, 2009 |
Let them leave Sanusi alone. No one has proffered a solution to the malpractices of the Bank executives but they are here screaming Sanusi. Instead of them blaming the man, why don't they blame the Bankers who had been squandering the public funds and feeding us lies? |
| Re: Sanusi Incompetent To Manage CBN? by adigun101: 3:41pm On Dec 13, 2009 |
Now there are a pile of cases in court over CBNs intervention. You guys know how things work in Nigeria this might go on for 2 yrs or more. None of the banks know how to interpret non-performing loans. The appetite for risks(a big part of banking investments) has been eroded. Banks are firing staff and closing branches. As much as 8 banks are being run by CBN directives. The banks access to credit lines are at its all time lows. Sumarilly the banking sector has a lot of uncertainties and ailments and seems to be in a comatose state, like Yar'adua  "Sanusi’s silence could have been informed by the realisation that his banking reforms are skewed towards achieving aims that well known to him alone". Well this might be the dip before things start to get better I hope but for now its not looking good. All pessimists like me can do is keep scores. |
| Re: Sanusi Incompetent To Manage CBN? by Ibime(m): 6:06pm On Dec 13, 2009 |
For all the sciolists talking about credit freeze, its imperative they understand the meaning of credit freeze before proferring unsolicited opinions. How do we measure credit freeze? Pls check the 90-day Nibor rate as of today (16.7%) as against 6 months ago (22%). If credit freeze indicates that tycoons and Government round-trippers no longer have access to easy uncollaterised loans, then I agree - there is absolutely a credit freeze. Does this mean the banks have less appetite for risk? Absolutely! They have less appetite for the kind of risk that forced them to write trillions of Naira off their books - but the economic indicator which measures liquidity of credit (Nibor rate) shows that credit has eased. |
| Re: Sanusi Incompetent To Manage CBN? by PapaBrowne(m): 6:32pm On Dec 13, 2009 |
Ibime, Interbank lending cannot in anyway be used as a measure to assess lending to the real economy at least in Nigeria. Nobody cares about Sanusi's impact on interbank lending. The credit that is frozen right now is that which is usually given to businesses to operate. This economy has stifled as a result. NIBOR rates might have reduced just 6%, but real credit has slumped much more than 80%! |
| Re: Sanusi Incompetent To Manage CBN? by Ibime(m): 6:44pm On Dec 13, 2009 |
PapaBrowne: First things first, banks have never lent to the real economy. Micro-credit institutions fulfill that role in Naija. Someone who does not have money to lend cannot lend. Banks having eroded all their capital in risky loans will not be able to continue lending lest they endanger their depositors. That has nothing to do with Sanusi. They havent been lending for the last year. Rather, they've been borrowing on the EDW. The fact NIBOR rate is falling shows that banks trust each other more now. If banks continued with their unscrupulous lending, then the NIBOR rate will go up because they will suspect each other of false disclosure of toxic assets. Secondly, corporate loan-repayment rates usually track the Libor, and I suppose they do the same to the Nibor. Thirdly, the unscrupulous lending they did before came back to hurt the taxpayer in the pocket by way of EDW and bailout. Again, that effect is detrimental to the real economy, in a country where Government spending counts for close to 50% of our total economy. |
| Re: Sanusi Incompetent To Manage CBN? by Remii(m): 8:26pm On Dec 13, 2009 |
Just like someone has written, it seems like we Nigerians complain too early about everything. I remember some people praising So ludo's consolidation today blamed and condemned the guy till end of his term. Banks are not lending for just 4 months now and we are today complaning. When they were lending who did they give the moneies to, were they not the share manipulators and property speculators? Which manufacturer can borrow money at 35% per year interstest. I believe with better strategy by banks in next few years all would be better for Sanusi's bare it all policy. |
| Re: Sanusi Incompetent To Manage CBN? by biina: 4:23am On Dec 14, 2009 |
PapaBrowne:Please clarify what you mean by 'real credit', and provide a credible source/evidence to support your '80% slump' claim |
| Re: Sanusi Incompetent To Manage CBN? by edoyad(m): 9:23am On Dec 14, 2009 |
@ Ibime and biina, i'm so proud of you two my eyes are becoming misty. @papabrowne, you seem to have exhausted your "Lamido" calumny cache. |
| Re: Sanusi Incompetent To Manage CBN? by prettyG: 9:56am On Dec 14, 2009 |
| Re: Sanusi Incompetent To Manage CBN? by mbulela: 10:40am On Dec 14, 2009 |
Ibime, you represent PH well big time. No relenting at all. sound arguments devoid of insults and ethnicity. If that sham election that Kosovo is conducting was for real, people like you should be winning a landslide. well done my broda. |
| Re: Sanusi Incompetent To Manage CBN? by PapaBrowne(m): 11:29am On Dec 14, 2009 |
biina:Everybody that is involved in some form of entrepreneurial activity needs credit to keep running. Be it overdrafts or short term loans or Letters of Credit. Importers need LOCs. Small scale industries need these credit facilities. Bakeries, Pure Water manufacturers, FMCG distributors, Building material traders, etc were getting credit under the previous regime. These people make up the Nigerian economy. They are the ones bearing the brunt of Sanusi's actions. Not so much because Sanusi sacked the CEO's, but because he has created an environment where banks are scared stiff to take the risk of issuing loans for the simple reason that he has criminalised risk taking. There is no business in Nigeria that would qualify for a loan if you over assess the risk implications. Nigeria is an extremely risky business environment. You have to take immense risk to give out loans. As regards a credible source/evidence to support my 80% figure, I work with data everyday. The figures are actually worse off, however, they are not conclusive, hence the 80% is just an estimation. |
| Re: Sanusi Incompetent To Manage CBN? by Ibime(m): 12:15pm On Dec 14, 2009 |
PapaBrowne: As a data analyst, claiming 80% drop in loan provision and attributing it to Sanusi is a serious faux pas. I am assuming that you are talking about 80% drop from last year. Lets assume that things were running as normal before Sanusi's appointment in June. Lets also assume that Sanusi froze credit completely, and no single loan was given from June till now. Lets also assume that aggregate supply of credit does not vary from month to month. Using a slide rule, we can assume that credit doled out from January to June (6 months) should be 50% of the previous year. Am I right or am I wrong? Now, if credit has dropped 80%, shouldn't the January - June statistics give us only a 50% drop from the previous year at least? Even if Sanusi froze the market completely, we should still be on 50%. A more objective view would tell you that the 80% drop you claim is as a result of the banks eroding their capital base and not having the money to give loans, whether under Sanusi or Soludo in the 6 months prior. Otherwise, we would only notice 50% drop in the worst-case scenario. Even your own data verifies the fact that the credit squeeze is ongoing and has been so since the start of the year. Picking data like this to explain issues is as much misguided as picking yearly data to show us that car sales have dropped 38% from last year. The least you can do is give us Jan-June, then June to Dec, and compare that with the equivalent periods from the previous year. This would help us differentiate between Sanusi and the previous status-quo. |
| Re: Sanusi Incompetent To Manage CBN? by PapaBrowne(m): 12:32pm On Dec 14, 2009 |
edoyad: Sincerely, I should naturally have exhausted my cache, but there is truckloads of arsenal coming out everyday that Sanusi himself has gotten worn out and all of a sudden become press shy. Only last week, Pat Utomi who applauded Sanusi's actions initially, has now filed a lawsuit against the CBN. Many more lawsuits are on the way. |
| Re: Sanusi Incompetent To Manage CBN? by PapaBrowne(m): 1:11pm On Dec 14, 2009 |
Ibime: You are absolutely right!! And I must admit that I admire the logic of your argument. Extremely brilliant! However, the data I refer to is for the last quarter 2009(Sep- Dec) in comparison with the last quarter of last year and it is raw and inconclusive. Results for the period won't come out until early next year. Right now, I am depending on pointers, and these pointers are turning out really bad results. Remember that the global crisis, the oil price crash , the Naira crash and Nigeria's stock market decline all happened last year. How come the last quarter of 2008 of is giving us much better results than that of this year. How come the impact of Sanusi's action is greater than the impact of the these four major events?? Even Sanusi himself isn't arguing the fact that his actions have caused tremendous crisis, he is defending his actions with the nonsense claim that if he didn't act, things would have been worse off. The question is: did he act right?? |
| Re: Sanusi Incompetent To Manage CBN? by paddylo1(m): 1:49pm On Dec 14, 2009 |
Thirdly, the unscrupulous lending they did before came back to hurt the taxpayer in the pocket by way of EDW and bailout. Again, that effect is detrimental to the real economy, in a country where Government spending counts for close to 50% of our total economy. Govt spending is closer to 26% of GDP not the 50% you quote. . . and i think sanusis actions are becoming a problem to private sector credit formation to the real sector however we should get a clearer picture by end 2Q 2010 |
| Re: Sanusi Incompetent To Manage CBN? by edoyad(m): 2:01pm On Dec 14, 2009 |
Comeon fellas, sanusi responsible for credit freeze in Nigeria ? Incase you don't know the melt down has crippled even economies like Dubai that rely so heavily on credit, it not a Nigerian phenomenon as is being painted ? What about the Capital flight from the Nigerian market, Market confidence itself etc ? I guess that too didn't have an effect on the market. We can find a hundred reasons for what is going on and i tell you Sanusi's gallant move would be the least culprit. |
| Re: Sanusi Incompetent To Manage CBN? by Ibime(m): 3:15pm On Dec 14, 2009 |
PapaBrowne: I thought so. . . . however, we will believe you when we see the source of your data.  Can you compare the 4 quarters of this year with each other rather than last year though? The argument remains that credit-lending slowed down considerably this year. It is also imperative to compare 2nd Q this year with 2nd Q last year. Both these Q's belong to Soludo. This would filter the noise of the general downturn, and help you point the finger more exclusively at Sanusi. paddy_lo: Thanks, I thought it was 30% but I was not sure. . . . my apologies. |
| Re: Sanusi Incompetent To Manage CBN? by biina: 7:12pm On Dec 14, 2009 |
PapaBrowne:Please correct me if I 've misunderstood your earlier post, but it seems you defined 'real credit' as all those credit instruments issued to entities outside of the banking sector. Thus i would expect your '80% slump' claim to be based on data from said banks or said entities. You have nether provided evidence to support your claim, nor made reference to any credible source(s) to to support it. To say that 'I work with data everyday' and expect the phrase to be taken as evidence of credibility is hilarious at best, and seems quite disingenuous. That you work with data does not not make said data, or your deductions from it, credible. You say that 'The figures are actually worse off, however, they are not conclusive, hence the 80% is just an estimation'. Yet you had earlier made it seem like a statement of fact saying PapaBrowne:if data are inconclusive, why say that credit has slumped much more than 80%?  Like I said before, you are simply spreading fear, doom and gloom about the sector, without any credible evidence to backup your claim. It is such actions that has increased the risk level in the sector by painting the picture of a poor state and/or uncertainty. Any well meaning Nigerian should not be focused on 'Sanusi the man', but on the policies and action of the CBN, and its attendant effect on the banking sector and the economy as a whole. This should be analyzed, and deductions made, based on concrete data and facts, and not conjectures and rumors like you seem to have done earlier. BTW you are yet to actually state at what point Sanusi got it wrong, and what the right alternative was. |
| Re: Sanusi Incompetent To Manage CBN? by otokx(m): 7:42pm On Dec 14, 2009 |
The losses being declared by this banks is so worrisome; and they were giving the loans to themselves. SOLUDO should kick start the next step and ensure that either these banks merge with stronger ones or that they are bought over by new owners who have a pedigree of good corporate values |
| Re: Sanusi Incompetent To Manage CBN? by bamshow: 7:59pm On Dec 14, 2009 |
The Self acclaimed king of the Jungle cannot but find views of other monarchs to support. The fundamental principle in Financial Management is Shareholders wealth maximisation. Now Ibru and her cohorts only ensured that Managers wealth maximisation was the only business Nigerian Banks pursued with all dedication. Now the veil of deciet was lifted and instead of Nigerians whose interest are being protected to applaud CBNs drastic actions, the absurd way we react is the opposite. Drastic times calls for Drastic measures. Ghana through Flt Lt J Rawlings did it and they are still reaping the benefits till today. Massively Ghana is improving not only economically but also socio-politically (evidenced by their free and fair election). I question the rational behind covering up this great evil perpetrated by the Banks CEOs all in the name of civility. I did my masters thesis on Risk Management and while looking at one of our banks annual reports in 2004-2006, I noticed a Director's brother took 3 loans amounting to Billions of Naira at different times and the amazing thing was 2 out of the loans were non performing yet the guy was still able to get another loan the next year to the report. without having liquidated the prior loan exposures. where is this country going to where such was allowed. Great Nigerians both within and without our National boundary, dont tell me such should be condoned. Why should Great Naija be known only for our propensity to cover up frauds, so as to protect the interest of a select few. do you know how many Market women and men that will be under untold hardship should those banks be allowed to fold. I rest my case for now. |
| Re: Sanusi Incompetent To Manage CBN? by nduchucks: 8:28pm On Dec 14, 2009 |
bamshow: shhhh, you are setting yourself up for bad mouthing the rule of law - don't you realize that the said director's brother has not yet been convicted of any crime? Please don't attempt to insinuate that Ibori or Cecelia Ibru is a criminal either, for they are yet to be convicted of any crime. |
| Re: Sanusi Incompetent To Manage CBN? by Remii(m): 9:31pm On Dec 14, 2009 |
e be like say the Sanusi attackers a la Vanguard Newspapers concocted "Northern Agenda" are out of points, abi wey Naijaking1, Beaf et al,  |
| Re: Sanusi Incompetent To Manage CBN? by kunolu: 12:43am On Dec 15, 2009 |
@ REMII: I think the chief made valid points, u seem not be objective in your thinking |
| Re: Sanusi Incompetent To Manage CBN? by Remii(m): 8:06am On Dec 15, 2009 |
@kunolu, you got me wrong, I am not referring to chief's points but my friends like Naijaking1 and Beaf that would not want to acknowledge any good in Sanusi's actions. You may have to read the trend from beginning. No credit crunch in the economy, says Sanusi http://www.proshareng.com/news/singleNews.php?id=8244 Reduced lending by banks as a result of the ongoing reforms in the banking sector does not translate to credit crunch, the Governor of the Central Bank of Nigeria, Mr. Lamido Sanusi, has said. He said although credit to the private sector declined between January and March 2009, it grew by 20 per cent between March and November. He, however, did not give a definite figure. Sanusi, who spoke at the sidelines of the Bankers‘ Committee‘s press briefing in Enugu on Sunday, said credit had grown every month from April, adding that what obtained in the past had contributed to the problems the sector was facing currently. His reaction came on the heels of complaints about the dearth of credit in the economy, occasioned by banks‘ current focus on aggressive loan recovery. He said, ”I have the figures. There was a decline in credit between January and March, but between March and November, credit to the private sector increased by 20 per cent, and credit has increased every month from April to November. ”People are used to the 2007 and 2008 period when credit was growing at between 70 per cent and 80 per cent, the bulk of which was going to stockbrokers and to people who should not have received credit in the first place. But the banks were giving them because they were not compelled to make provisions. ”Now, they are being very careful. If they are not convinced that you can pay, they will not lend to you. A growth of 20 per cent is not a credit crunch. The Gross Domestic Product has grown by 7.5 per cent even though it has not grown as much as it would have grown if the money had gone to the right sectors.” According to the CBN‘s Economic Report for the Second Quarter of 2009, “At N5.7tn, aggregate banking system credit (net) to the domestic economy increased by 17.8 per cent in the second quarter of 2009, as against the decline of 2.6 per cent in the preceding quarte It said, ”Banking system‘s credit to the private sector rose by 3.6 per cent to N8.3tn, compared with the increase of 1.3 per cent in the preceding quarter.” The CBN governor also said the apex bank was working on the entire regulatory framework of the microfinance sector, adding that it had started a process that would compel a managing director of a microfinance bank to go through a certification process. ”We have started a process now where anybody who is a managing director of a microfinance bank has to go through a certification process, and if the consultants do not certify you, you can‘t run a microfinance bank. We have a framework for regulation and supervision and we will come out with guidelines,” he said. |
| Re: Sanusi Incompetent To Manage CBN? by Ibime(m): 10:29am On Dec 15, 2009 |
Ibime: Remii: Thank you! PapaBrowne, what do you have to say about this, or do you have some contradictory stats? |
(1) (2) (3) ... (6) (7) (8) (9) (Reply)
Why You Should Not Lend Your Credit Card To Others / MTN Returns To Profit As It Overcomes $1billion Nigeria Fine / How Do I Retrieve My Airtel Sim Without Sim Pack
(Go Up)
| Sections: politics (1) business autos (1) jobs (1) career education (1) romance computers phones travel sports fashion health religion celebs tv-movies music-radio literature webmasters programming techmarket Links: (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) Nairaland - Copyright © 2005 - 2024 Oluwaseun Osewa. All rights reserved. See How To Advertise. 82 |