The recent dismissal of staff from various banks is totally unacceptable, unprofessional and inhumane. You should be aware by now that the problem these banks have, is mainly as a result of the bad loans they gave out. Most of such loans were given out by their loans department and approved by top management staff. Therefore, if such dismissals are to take place, then the management of the affected banks should start such an exercise from their loan departments and top management personnel while ensuring such staff are brought to book. Unfortunately, observations have shown that the bulk of the relieved/sacked/dismissed staff are of the middle and lower cadre and not the top management personnel. The dismissal of such staff who know nothing about the bad loans given out is sad and painful-very painful. After all they are not the cause of the banks’ problems and predicament. It just might interest you to know that many of these bad loans were given to friends and associates of top management staff who duly approved such loans-after all they had their own ‘cut’ in such deals. Pathetic!

The management of such banks should endeavour to get a true picture of how things got bad in the first place and eliminate such problems from occurring in future. The way they are tackle this issue beats my long term logical reasoning and understanding. I therefore see these dismissals as a temporary solution to a long term problem. Some top management staff who are guilty of given/approving some bad loans are still in the banking system while those credible ones have been flushed out. Like they say one bad egg in a basket can turn the whole basket bad. In essence, If we still have some guilty top management staff in our systems, then it is inevitable that this same problem will arise in the future. I suggest to management of all affected banks; flush out all loans departmental staff and most top management staff, make middle and lower cadre staff to fill such vacant positions and persecute ALL those guilty of giving out bad loans.

Sanusi has succeeded in taking the banking industry many steps back. Like it or not. CBN advised banks to cut down on staff strengths and reduce salaries by as much as 30%. Reduce staff strength? Well, this will have a rippling effect on the economy. Take an average sack of about 1300 staff per bank and multiply by ONLY 20 banks. This means an additional 26,000 people will be forced back into the already saturated labour market. Crime rate, frustration, inflation etc will inevitably be on the increase. What a sensible human being in charge of an apex bank would have done or suggested is simple to cut down on salaries alone and not include reducing staff strength.
What these decisions of CBN have done is simply to bring discredit to the banking sector and increase lack of confidence in the sector. If banks as big as Oceanic and Intercontinental are declared ‘not healthy’, then I am sure most people would not even want to deposit their hard earned money in the banks. Lamido Sanusi on assumption of duties as the CBN said he wanted foreign investors to take over some banks. Obviously, with the current trend, no investor will want to invest right now. This same Lamido recently said he does not need foreign investors (am sure after realizing his error) I hope he is not confused.

No body should get me wrong. I am not saying that the affected banks are healthy or not healthy. What I am insinuating is that the situation would have been managed away from public attention. In so doing there will still be much confidence in the banking sector while books and bad loans are being regularized and recovered respectively. This is where I think Soludo is a lot better than Sanusi. Soludo managed situations better without exposing banks.

Lamido Sanusi removed 5 MD’s without even giving them a chance to explain a single thing meanwhile he gave some other banks time to regularize their books. This does not sound like a fair playing ground but one that has an undertone of revenge or ‘beef’ for some banks MD. I feel so sad for Madam Cecilia in particular. Despite growing a bank virtually from scratch and providing jobs for lots of Nigerian (including many 9ralanders)one short bowed tied dumb ass is removing her without any true real justification and without following due processes.I wonder who actually removes MD’s? Board of directors, shareholders or a bowed tied man? i believe in the law of karma. Sooner or later RAM-ido AAS-nusi will be brought to book in similar fashion to Ribadu, El-Rufai and Tafa.

You want all the loan department staffs of the banks affected to be sacked and the positions left taken up by the middle and low cadre? Wonderful!

The over bloated salaries of bankers were not in order and today order is being restored and in the long run the banking industry will be better, salaries will be realistic, banks will be more proactive in generating legitimate money instead of falsifying accounts and they will not need to turn our young women into professional love-peddlers to meet unreliable targets.

Water will find its level with time and the time has come for the banking industry to be sanitized.

Ever wondered why a genuine trader cannot access N50,000.00 loan due to the very difficult conditions whereas another person can access N2,000,000,000.00 without collateral just because he knows the bank CEO and the funds are usually wasted and the bank in turn claims the loan is a bad loan?

What Sanusi is doing today is ok and is actually saving a lot of jobs that would have just disappeared in a few years when the effects of the lies and falsification of accounts would have gone full circle.

Meanwhile, the disengaged workers I understand where not sacked but advised to resign and I believe they were adequately compensated. I doubt if any bank would just sack someone without a good reason. Sack and resignation (whether cajoled, induced or advised) are not the same thing. The disengaged bankers can use the money paid to them to start a new life.

Afam:

You want all the loan department staffs of the banks affected to be sacked and the positions left taken up by the middle and low cadre? Wonderful!

The over bloated salaries of bankers were not in order and today order is being restored and in the long run the banking industry will be better, salaries will be realistic, banks will be more proactive in generating legitimate money instead of falsifying accounts and they will not need to turn our young women into professional love-peddlers to meet unreliable targets.

Water will find its level with time and the time has come for the banking industry to be sanitized.

Ever wondered why a genuine trader cannot access N50,000.00 loan due to the very difficult conditions whereas another person can access N2,000,000,000.00 without collateral just because he knows the bank CEO and the funds are usually wasted and the bank in turn claims the loan is a bad loan?

What Sanusi is doing today is ok and is actually saving a lot of jobs that would have just disappeared in a few years when the effects of the lies and falsification of accounts would have gone full circle.

Meanwhile, the disengaged workers I understand where not sacked but advised to resign and I believe they were adequately compensated. I doubt if any bank would just sack someone without a good reason. Sack and resignation (whether cajoled, induced or advised) are not the same thing. The disengaged bankers can use the money paid to them to start a new life.

You are still there deceiving yourself. Even Sanusi himself now knows that he went about the whole thing in a very wrong way!
Please for once be objective!

I totally agree with you that Soludo is a better manager than Sanusi. The fact of the matter is that Sanusi not only acted in haste, but executed his agenda with malice and vengeance. The banking crisis arose because of the sub-prime mortgage in the West, what you can call loan advancement in Nigeria. While the US and other western govt are finding solution to their problem without over dramatising the issue, secretary of treasury has not recommended any bank MD or EDs for the guillotine.In any case Sanusi has been part of the problem. Under him, loans running into billions of naira went bad and provisions made as seen in the recent financial statement of FBN. He is garrulous and does not have the temperament of a person fit to occupy such sensitive portfolio. His comments are not only killing the financial services industry, the macro economic environment has been seriously injured. Foreign direct investment has virtually seized and the available ones are taking flight from the economy. No nation can ever develop when you muzzle your banks and create situation of instability by reckless utterances as those by Sanusi. The pronouncement of a Geithener will always have a far reaching effect on banks, money market, stock market,interest rates and other macroeconomic variables in the US.

And it is time the Nigerian Govt realised that the Headship of CBN is meant for seasoned economists and perhaps chartered accountants who understand the dynamics and complex nature of finance. It is not a position for carrier bankers who know next to nothing about macroeconomic management other than managing the intricacies of the debit and credit of everyday banking situation.

PapaBrowne:

You are still there deceiving yourself. Even Sanusi himself now knows that he went about the whole thing in a very wrong way!
Please for once be objective!

I have always been objective. I guess you need to take your own advice and stop being subjective about the issue.

d man has done more harm dan good. The job losses r gagantuan,n most of d ppl affected where nt compensated(some where jst given 1 month salary in advance). The yardstick used 2 do d audit left a lot 2 b desired. Soludo was much better

buchio7:

d man has done more harm dan good. The job losses r gagantuan,n most of d ppl affected where nt compensated(some where jst given 1 month salary in advance). The yardstick used 2 do d audit left a lot 2 b desired. Soludo was much better

Soludo would have prevented the problem or have tackled it if he wanted to. I guess he knew he was going into politics and as such didn't want anyone using the bank wahala against him in the elections.

Please tell me how SANUSI is involved in the sack of UBA staff? Is he the owner of UBA? Leave SANUSI alone, the banks are only taking decisions that will make them more profitable.

otokx:

Please tell me how SANUSI is involved in the sack of UBA staff? Is he the owner of UBA? Leave SANUSI alone, the banks are only taking decisions that will make them more profitable.

And to add to that UBA was not listed as one of the troubled banks so it should be obvious that the banks are only doing all they can to return to profitability especially now that they are not allowed to cook their books with maggi or knorr cubes.

I think our banking sector is over-bloated. Too many employees on unsustainable salaries. This mass culling is very good for the banking industry as it is way of revamping their cost structure.

4 Play:

I think our banking sector is over-bloated. Too many employees on unsustainable salaries. This mass culling is very good for the banking industry as it is way of revamping their cost structure.

Spot on. . . . Healthy move to make the banking sector more sustainable
It is unfortunate for the people who have been caught and will probably be caught up in the "culling exercise"
But the restructuring and downsizing is absolutely imperative

Taborah:

I totally agree with you that Soludo is a better manager than Sanusi. The fact of the matter is that Sanusi not only acted in haste, but executed his agenda with malice and vengeance. The banking crisis arose because of the sub-prime mortgage in the West,  what you can call loan advancement in Nigeria. While the US and other western govt are finding solution to their problem without over dramatising the issue, secretary of treasury has not recommended any bank MD or EDs for the guillotine.In any case Sanusi has been part of the problem. Under him, loans running into billions of naira went bad and provisions made as seen in the recent financial statement of FBN. He is garrulous and does not have the temperament of a person fit to occupy such sensitive portfolio. His comments are not only killing the financial services industry, the macro economic environment has been seriously injured. Foreign direct investment has virtually seized and the available ones are taking flight from the economy. No nation can ever develop when you muzzle your banks and create situation of instability by reckless utterances as those by Sanusi. The pronouncement of a Geithener will always have a far reaching effect on banks, money market, stock market,interest rates and other macroeconomic variables in the US.

And it is time the Nigerian Govt realised that the Headship of CBN is meant for seasoned economists and perhaps chartered accountants who understand the dynamics and complex nature of finance. It is not a position for carrier bankers who know next to nothing about macroeconomic management other than managing the intricacies of the debit and credit of everyday banking situation.

I don't fault his actions, i fault his lack of proper conduct and the malicious nature from which his decisions were made.

I fault the Soludo administration for folding arms and playing politics while the banks doctored their books

I fault the banks more for putting the Nigerian economy at risk of a potential stand still and a massive loss in jobs than what we are experiencing if the practice went on.

Has anyone wondered why the Yardua administration is yet to release an official report from the presidency concerning this whole Banking saga?
How long does it take Obama to respond to issues regarding Financial services and credit crises?

Taborah:

I totally agree with you that Soludo is a better manager than Sanusi. The fact of the matter is that Sanusi not only acted in haste, but executed his agenda with malice and vengeance. The banking crisis arose because of the sub-prime mortgage in the West, what you can call loan advancement in Nigeria. While the US and other western govt are finding solution to their problem without over dramatising the issue, secretary of treasury has not recommended any bank MD or EDs for the guillotine.In any case Sanusi has been part of the problem. Under him, loans running into billions of naira went bad and provisions made as seen in the recent financial statement of FBN. He is garrulous and does not have the temperament of a person fit to occupy such sensitive portfolio . His comments are not only killing the financial services industry, the macro economic environment has been seriously injured. Foreign direct investment has virtually seized and the available ones are taking flight from the economy. No nation can ever develop when you muzzle your banks and create situation of instability by reckless utterances as those by Sanusi. The pronouncement of a Geithener will always have a far reaching effect on banks, money market, stock market,interest rates and other macroeconomic variables in the US.

And it is time the Nigerian Govt realised that the Headship of CBN is meant for seasoned economists and perhaps chartered accountants who understand the dynamics and complex nature of finance. It is not a position for carrier bankers who know next to nothing about macroeconomic management other than managing the intricacies of the debit and credit of everyday banking situation.

Your contribution has been the most meaningful. The issue remains the handling by Sanusi and not if there was a problem afterall as rightly noted by you, he booked major bad loans as first bank MD.

Sanusi handled the matter so poorly that one can hardly see the strategic intent. The problem he has created is now one of mainly confidence  all those talking of bloating salaries really dont understand how financial services work and have left the substance and dwelling on trivalities and sensationalism.

The issue now is that most of the credit lines from international banks have been recalled so there is a credit crunch particularly in the area of export which was one of the main revenue generators for Nigerian banks.

It's really a pity but this has to happen to safe guard our personal money and d financial sector as a whole even though 2 of my friends so far have been caught on the wrong side of this exercise. I hope they get new jobs soon in the coming new year.

away4real:

Your contribution has been the most meaningful. The issue remains the handling by Sanusi and not if there was a problem afterall as rightly noted by you, he booked major bad loans as first bank MD.

Sanusi handled the matter so poorly that one can hardly see the strategic intent. The problem he has created is now one of mainly confidence  all those talking of bloating salaries really dont understand how financial services work and have left the substance and dwelling on trivalities and sensationalism.

The issue now is that most of the credit lines from international banks have been recalled so there is a credit crunch particularly in the area of export which was one of the main revenue generators for Nigerian banks.

I see it as a smoke which will eventually come out, lets be realistic, how long do you think those banks intend to continue keeping bad loans on their balance sheet, 80 billion naira bad loan is not something you can just hide under a smile for very long.
The effects either you choose to accept it or not are bound to reveal themselves one day, better now than later don't you think?

scottN:

It's really a pity but this has to happen to safe guard our personal money and d financial sector as a whole even though 2 of my friends so far have been caught on the wrong side of this exercise. I hope they get new jobs soon in the coming new year.

This does not have to heppen to safe guard personal deposits and the financial sector.

Perhaps if we had seen  a properly thought out risk management mechanism a wholistic approach and not the half hearted witch hunting that took place. We would have had a case when there was a clear transparent approach and banks that fall short will be obvious to all.

violent:

[b]Has anyone wondered why the Yardua administration [/b]is yet to release an official report from the presidency concerning this whole Banking saga?
How long does it take Obama to respond to issues regarding Financial services and credit crises?

You will wait till thy kingdom cometh. . .
You are talking about an incompetent "Yaradua administration" which has no bloody clues as to what is going on

violent:

I see it as a smoke which will eventually come out, lets be realistic, how long do you think those banks intend to continue keeping bad loans on their balance sheet, 80 billion naira bad loan is not something you can just hide under a smile for very long.
The effects either you choose to accept it or not are bound to reveal themselves one day, better now than later don't you think?

I really dont get what you mean by better now. The issue was the handling, Sanusi himself booked bad loans so how can all of a sudden he is handpicking.

What ratios were used, what tests were done. The federal reserve has the stress test it uses to determine if banks can pay back bail out money, what criteria did CBN use in determining the health of the banks.

Then assuming the banks had problems as he claimed, they have not used the bail out funds so the question is what level of illiquidity were they operating at the time. The CBN can not talk down its own banks in a global world that information /rumours of bad news can wreak institutions. It was a shame listening to Sanusi on CNN, he had no clue the harm he was doing to the Nigerian Macro economy he was just talking and thought he sounded intelligent so sad.

Was complainin that banks where understaffed ,now that the are sacking ,we should expect longer lines and delays in the banking hall.

Your post is interesting,but you did not give suggestion how Sanusi could have manage the situation without the public knowledge,
any nation that  has  problem with are cash deposits and no working industrial base to fully capacity is finished.We don't want a situation,
where you and me we get to bank only to be unable to do bank transaction especially bank withdrawer.

If only someone had intervened decisively in the case of Enron in 1999/2000, perhaps the devastating bankruptcy coud have been avoided and 22000 employees would not have been jobless.
But perhaps if someone had intervened then, you'd have a few shortsighted people complaining about retrenchments and other cost saving methods, just like how some of you here are whining about Sanusi.


It beats me hollow how some people are lauding Soludo for 'managing the situation quietly'. The man saw the rot and kept quiet for his own political and personal gains. Between Soludo and Sanusi, we at least know one of them that took swift and decisive action to curb the bleeding.

away4real:

. It was a shame listening to Sanusi on CNN, he had no clue the harm he was doing to the Nigerian Macro economy he was just talking and thought he sounded intelligent so sad.

HAve you considered that it may well be because you people have put Sanusi on the defensive for merely doing his job that he has to go around defending his actions and his position with vigor? Someone carried out actions to bring sanity in the banking sector and he was promptly submerged with accusations of tribalism, Northern agenda, Sharia culture, favouritism, bias and corruption. And let's not forget the infamous Vanguard article (a favourite tool in the hands of fools). When presented with such full spectrum, unfounded accusations what is the man supposed to do but defend himself increasingly?

Has any of you ever asked Soludo what he did to manage the situation? I mean, you all bandy that phrase about, but what did he really do?

texazzpete:

HAve you considered that it may well be because you people have put Sanusi on the defensive for merely doing his job that he has to go around defending his actions and his position with vigor? Someone carried out actions to bring sanity in the banking sector and he was promptly submerged with accusations of tribalism, Northern agenda, Sharia culture, favouritism, bias and corruption. And let's not forget the infamous Vanguard article (a favourite tool in the hands of fools). When presented with such full spectrum, unfounded accusations what is the man supposed to do but defend himself increasingly?

Has any of you ever asked Soludo what he did to manage the situation? I mean, you all bandy that phrase about, but what did he really do?

Thank you jare. . . .
TP i am baffled at the pathetic level of reasoning of so many peeps on the forum. . . .
At times it aint even worth debating or discussing with anyone who cant think out of the box!

texazzpete:

HAve you considered that it may well be because you people have put Sanusi on the defensive for merely doing his job that he has to go around defending his actions and his position with vigor? Someone carried out actions to bring sanity in the banking sector and he was promptly submerged with accusations of tribalism, Northern agenda, Sharia culture, favouritism, bias and corruption. And let's not forget the infamous Vanguard article (a favourite tool in the hands of fools). When presented with such full spectrum, unfounded accusations what is the man supposed to do but defend himself increasingly?

Has any of you ever asked Soludo what he did to manage the situation? I mean, you all bandy that phrase about, but what did he really do?

What did Soludo do to manage his own situation. Soludo came up with a strategic paper few months ahead on the aim of his consolidation and provided modalities and incentives for mergers. He did not wake up one day and said all banks must meet N25 billion, it was a prperly thought out scheme.

I have not painted Sanusi a tribalist, but he has failed to provide the adequate intellectual mechanism needed for such a delicate execise. Your comparison to Enron earlier is inappropriate, why did the Bank of england or Federal reserve not kill the banks that they gave out loans to individuals that cant pay their mortgages.

The problem of the margin loans is in a way similar to the sub prime wrong calculation of the risk. Lets limit this debate to issues and not sensatious stories or conspiracy theories.

Sanusi should provide credible ratios and test and a strategic intent to guide all banks and give a time frame to achieve it, and not be in a haste to crucify Nigerian banks.

MrCrackles:

Thank you jare. . . .
TP i am baffled at the pathetic level of reasoning of so many peeps on the forum. . . .
At times it aint even worth debating or discussing with anyone who cant think out of the box!

Sometimes, the thing confounds me o! Imagine a case when the news first broke of the Nigerian bomber's attempt and several reactions here were insisting that the whole thing may have been a CIA plot to invade the Niger Delta.
NIgerians have long preferred to put their trust in wildly implausible conspiracy theories instead of using their God given brains  

The messiah culture in Nigeria has meant people are extremely reluctant to give up their heroes. Nigerians LOVE their heroes! Which is why to many Dora Akunyili can do no wrong, and to those Soludo worshippers, it's far better to heap all the blame on Sanusi than to acknowledge that their hero may have been asleep at the wheel in recent times.

away4real:

What did Soludo do to manage his own situation. Soludo came up with a strategic paper few months ahead on the aim of his consolidation and provided modalities and incentives for mergers. He did not wake up one day and said all banks must meet N25 billion, it was a prperly thought out scheme.

I have not painted Sanusi a tribalist, but he has failed to provide the adequate intellectual mechanism needed for such a delicate execise. Your comparison to Enron earlier is inappropriate, why did the Bank of england or Federal reserve not kill the banks that they gave out loans to individuals that cant pay their mortgages.

The problem of the margin loans is in a way similar to the sub prime wrong calculation of the risk. Lets limit this debate to issues and not sensatious stories or conspiracy theories.

Sanusi should provide credible ratios and test and a strategic intent to guide all banks and give a time frame to achieve it, and not be in a haste to crucify Nigerian banks.

Please stop dodging the issue. The rot in the banking sector did not happen overnight. It happened in Soludo's tenure, and he had to be aware of it. So what exactly did he do to manage the situation? If he was actually doing something, then why is there no indication that there were any ongoing improvements?

My Enron analogy is apt in this situation. Had prompt action been taken in Enron case, bankruptcy may have been avoided. Definitely Enron would have had to downsize to minimize losses - hence a loss of non-critical manpower (which is what is happening here). Enron was allowed to collapse and instead of merely taking a bitter pill, the whole body was lost.
In this case these measures the banks are taking are to ensure profitability and viability. Do you have any proof that the cost of doing noting would have been less?

You do realize that Royal Bank of Scotland and the Lloyd's Banking Group had to sell off many bank branches and lay off several staff to stay afloat even after the injection of bailout funds from the British Government?

It's only when it happens in Nigeria that people start blaming the person bailing out the ailing banks.

away4real:

What did Soludo do to manage his own situation. Soludo came up with a strategic paper few months ahead on the aim of his consolidation and provided modalities and incentives for mergers. He did not wake up one day and said all banks must meet N25 billion, it was a prperly thought out scheme.

I have not painted Sanusi a tribalist, but he has failed to provide the adequate intellectual mechanism needed for such a delicate execise. Your comparison to Enron earlier is inappropriate, why did the Bank of england or Federal reserve not kill the banks that they gave out loans to individuals that cant pay their mortgages.

The problem of the margin loans is in a way similar to the sub prime wrong calculation of the risk. Lets limit this debate to issues and not sensatious stories or conspiracy theories.

Sanusi should provide credible ratios and test and a strategic intent to guide all banks and give a time frame to achieve it, and not be in a haste to crucify Nigerian banks.

In economies with advanced financial services system, the Bank's risk from lending activities was thought to be adequately distributed in the forms of collateralized debt obligations and Insurance policies, so every one was believed to be happy.

In Nigeria, this is far from being the case, the wealthy got richer from loans from the banks and they just simply refused to pay back, many of them bought properties abroad with depositors funds, acquired massive real estates and invested the remainder in long term holdings. But the question is who bears the risk of default? Depositors of course.

This is where the Regulatory frame work comes in, you can't keep borrowing money from the Expanded discount windows to individuals based on their name and net worth alone, or more ridiculously because the borrower is a friend of the family,  you need a form of collateral just incase of an event of default which we witnessed.

Moreover i doubt any sane regulatory frame work will not consider liquidity, profitability and cash ratios before taking such a decision, the banks are over leveraged, and its totally due to the shameful malpractices of the CEOs. now guess who is bearing the brunt? the shareholders and the employees of course, logic will dictate that if it hadn't been curbed on time, Depositors will surely have their share of the cake, and trust me, that will be the beginning of a fcked up economy.

Yes Soludo did the work of consolidation, and we were so thankful for that to an extent where all eyes were closed against the rot that rooted in the post consolidated banks while Soludo secretly planned his political ambition.

Sanusi is not to blame, the dude is just doing his work protecting the Nigerian economy and depositors interest, blame Soludo for putting his own personal interest before everything else.

Before anyone post anything here they should go and check the definition of a bank first.
Ok, Let's just assume Sanusi left the doctored books as they were and in April 2010 customers of Oceanic and Intercontinental start complaining that they can't make withdrawals anymore and eventually the inevitable happens, they go under. All millions of depositors clueless as to what would become of their life savings, does that sound like the working of a sound financial system to anyone ?
At the end of the day Sanusi, whether refined or not, was put there "primarily" to protect the millions of depositors and as long as their money is safe and the banks carrying out their duties without risk of collapse, every one else can go to hell. For once someone has done something to protect small man money in Nigeria but they're still castigating him, you can Maryam IBB to where she's going if you don't like it.

ov:

The recent dismissal of staff from various banks is totally unacceptable, unprofessional and inhumane. You should be aware by now that the problem these banks have, is mainly as a result of the bad loans they gave out. Most of such loans were given out by their loans department and approved by top management staff. Therefore, if such dismissals are to take place, then the management of the affected banks should start such an exercise from their loan departments and top management personnel while ensuring such staff are brought to book. Unfortunately, observations have shown that the bulk of the relieved/sacked/dismissed staff are of the middle and lower cadre and not the top management personnel. The dismissal of such staff who know nothing about the bad loans given out is sad and painful-very painful. After all they are not the cause of the banks’ problems and predicament. It just might interest you to know that many of these bad loans were given to friends and associates of top management staff who duly approved such loans-after all they had their own ‘cut’ in such deals. Pathetic!

The management of such banks should endeavour to get a true picture of how things got bad in the first place and eliminate such problems from occurring in future. The way they are tackle this issue beats my long term logical reasoning and understanding. I therefore see these dismissals as a temporary solution to a long term problem. Some top management staff who are guilty of given/approving some bad loans are still in the banking system while those credible ones have been flushed out. Like they say one bad egg in a basket can turn the whole basket bad. In essence, If we still have some guilty top management staff in our systems, then it is inevitable that this same problem will arise in the future. I suggest to management of all affected banks; flush out all loans departmental staff and most top management staff, make middle and lower cadre staff to fill such vacant positions and persecute ALL those guilty of giving out bad loans.

Sanusi has succeeded in taking the banking industry many steps back. Like it or not. CBN advised banks to cut down on staff strengths and reduce salaries by as much as 30%. Reduce staff strength? Well, this will have a rippling effect on the economy. Take an average sack of about 1300 staff per bank and multiply by ONLY 20 banks. This means an additional 26,000 people will be forced back into the already saturated labour market. Crime rate, frustration, inflation etc will inevitably be on the increase. What a sensible human being in charge of an apex bank would have done or suggested is simple to cut down on salaries alone and not include reducing staff strength.
What these decisions of CBN have done is simply to bring discredit to the banking sector and increase lack of confidence in the sector. If banks as big as Oceanic and Intercontinental are declared ‘not healthy’, then I am sure most people would not even want to deposit their hard earned money in the banks. Lamido Sanusi on assumption of duties as the CBN said he wanted foreign investors to take over some banks. Obviously, with the current trend, no investor will want to invest right now. This same Lamido recently said he does not need foreign investors (am sure after realizing his error) I hope he is not confused.

No body should get me wrong. I am not saying that the affected banks are healthy or not healthy. What I am insinuating is that the situation would have been managed away from public attention. In so doing there will still be much confidence in the banking sector while books and bad loans are being regularized and recovered respectively. This is where I think Soludo is a lot better than Sanusi. Soludo managed situations better without exposing banks.

Lamido Sanusi removed 5 MD’s without even giving them a chance to explain a single thing meanwhile he gave some other banks time to regularize their books. This does not sound like a fair playing ground but one that has an undertone of revenge or ‘beef’ for some banks MD. I feel so sad for Madam Cecilia in particular. Despite growing a bank virtually from scratch and providing jobs for lots of Nigerian (including many 9ralanders)one short bowed tied dumb backside is removing her without any true real justification and without following due processes.I wonder who actually removes MD’s? Board of directors, shareholders or a bowed tied man? i believe in the law of karma. Sooner or later RAM-ido AAS-nusi will be brought to book in similar fashion to Ribadu, El-Rufai and Tafa.

I thought we had moved on from these faulty arguments?
He sacked them based on the powers conferred on him by the constitution.
the cases are in court,so i wonder what you mean by lack of due process.
No one resigns in Nigeria, so having a tea party for them to defend themselves would have been counter productive as all it would have done is give them time to cook the books some more.
He needed to act swiftly and decisively.
you talk about Oceanic and Intercontinental being 'big' banks.This bigness is a product of banking gangsterism and cooked book.
Why are you feeling sad for Mrs Ibru?It is obvious to any sane mind that if banking is practised in this clime the way it ought to, that madam has no business being a branch manager in any serious bank.besides, she over reached herself, wrecked her bank and Sanusi is not a party to her alleged crooked and faulty decisions.
If Sanusi was as vengeful as they claim, Tony Elumelu would have been the one on the run and not Pastor Akingbola.
I am no fan of Sanusi and i have noted view that he does not possess the tact and silence needed to function as a reserve bank governor.
Just like Soludo,he seems to love publicity,although he is no match for Soludo in that regard.The man was a showbiz impressario.always in the papers and tv.

Where is the celebrated capital?

It is difficult to crack the mystery behind the mismatch between figures celebrated post-consolidation and revelations by the Sanusi-led CBN. Apart from reports of fraud and self enrichment against some former bank chiefs, which reportedly left worn out balance sheets, there had also been rumblings among the banks that some accounts were made up.


A former managing director of one of the first generation banks, who spoke on the condition of anonymity with our correspondent, said, “Some banks had engaged in falsification of accounts. Some of them could not make the N25bn requirement by the CBN but they patched it up. We knew it. Even at that, those that met up with the requirement had to invest what they had and that was where the misplacement of priorities set in.


“Many diverted heavily to the capital market and the investments went down and also constituted significant losses. Everyone at that time was looking at a one-way flow, thinking the market would keep rising.”


Universal banking, to the former bank chief, also opened avenues for crises since leakages in subsidiaries naturally affected the main banks.


According to him, “Banks had subsidiaries, which were dealing in the capital market. They lost a lot of money, which affected the banks. There was also insincerity on the part of some of the operators and this affected everybody. They were planning on false data and other banks around were ruffled.


“When people start making noise and declaring huge profit, and you are in the same market, in order not to lose your market share, you also have to look for ways to keep being in business. Unfortunately, we now know that all that had no basis.”


The Deputy Governor, Operations, CBN, Mr. Tunde Lemo, also told our correspondent recently that it had been found, through full disclosure and transparent financial reporting, that the growth in the banking sector in the past three years had been superficial.


“If right now, two-thirds of the capital the banks claimed they raised is not there, then it was bubble capital, which means that with the reality on ground, they have to be slim and fit,” he noted.


Beyond this, the CBN audit might have confirmed that reckless credit management had eaten deep into the bank’s accounts. The first list of debtors of five banks published by the CBN had put total non-performing loans at N747bn. Oceanic Bank had the highest amount of non-performing loans of N278.2bn, followed by Intercontinental Bank with N210bn. Afribank, Union Bank and Finbank had non-performing loans of N141.9bn, N73.6bn and N42.4bn, respectively.


A second list of debtors, published on the CBN’s website on October 14, 2009, put the non-performing loans of the five banks that failed the second round of the apex bank’s stress test at N451bn. Bank PHB accounted for the highest non-performing loan of N170.96, while Wema Bank followed with N101bn. Spring Bank’s total non-performing loan was N95.59bn while Unity Bank and ETB had N46.1bn and N34.12bn respectively.


A breakdown of the figures, however, showed that the loans across the banks were concentrated mainly in the hands of the same top Nigerian businessmen, oil companies and stockbrokers. This, experts said, explained why manufacturers maintained that the benefits of consolidation did not trickle down to them.