₦airaland Forum

Ileke-IdI:
Wow, Nigeria needs this. . . . more tourist.

Oh really, the jobs must be doing a great job playing "hide".

Well said.

War Horse:
3. Mindset of "The Boss"
Can you believe that Bill gates is not the Chief Executive Officer of Microsoft? Bill used to be but he later stepped down from the position for someone better that he is in the job of CEO - Steve Ballmer(or something like that). Nigerian business men? Almost never. they want to be Chairman, CEO even after death. bad business oooooooooooooo. Business is driven by varied functions. you must use the right person for the right job. That leads to the fourth reason -

I do not totally agree Steve Balmer is better than Bill Gates on the job. Bill Gates had to step down from running the business mainly due to anti-competition/monopolistic strategy and agreements made thereafter.

Dis Guy:
How does the idea of letting this banks fail sound to you?
The monies used to save them came from peoples taxes
its not out of place to ask them to justify their lending rates

http://www.businessownerdebt.co.uk/hbos-charge-3650-percent-overdraft-on-10/

The estimated costs are based on average figures and the amount of time overdrafts are used.” ‘Very unfair’ Bank customers also complained to Panorama about the Halifax, which is owned by Lloyds Group Plc, a recipient of more than £20bn from the taxpayer in the bailout in late 2008.

They said it was charging an effective annual rate of interest of 3,650% on an overdraft of just £10. Instead of charging advertised interest on overdrafts, the bank is instead charging a flat fee of £1 a day.

But over the course of a year, customers with small overdrafts end up paying a disproportionately high rate of interest.

The Halifax said in a statement that customers have said they “want a clear overdraft charging structure” and the £1 a day represents “a simple set of daily fees”. The bank said it offers a “buffer zone” for overdrafts of less than £10 that is free and that the vast majority of its customers do not go into overdraft. Merryn Somerset Webb, editor-in-chief of MoneyWeek, said of the Halifax policy: “It is very unfair because the interest rates effectively are much, much higher for people with tiny overdrafts than for very big overdrafts. So you can be penalised extraordinarily badly.”

Source: BBC

”By the time we have done the mergers and acquisitions, taken off the toxic assets and gone through a recapitalisation process, the supply side of credit will improve,”

Sanusi said.

In my own understanding, what they intend to do is make Asset Mgt Companies buy up non performing loans collaterised with shares (which have lost most of its value in the stock marlket).

The cash received by banks from AMCs will then be used to extend lending to the real sector of the economy. The real sector being manufacturing, commercial etc companies.

Right now, banks are not lending to most people becos they are not in a position to. It also affects your naira in GTB becos if the banks don't lend they can't make enough income to pay you interest on your deposit or better still, they can't guarantee if you knock on their door tomorrow that they will even give you your deposit.

It is very important that CBN and all stakeholders get the post banking reform right.

paddy_lo:
It seems to me that the CBN has been touting this bill as the panacea for the Nigerian banking sector

I don't agree they have been touting AMCON as the panacea for the Nigerian Banking Sector.
The AMCON aims to purchase select toxic assets (capital markets related) of Nigerian deposit money banks.

paddy_lo:
It is going to be interesting to see how this all plays out

Very interesting indeed. i just hope it is properly monitored and controlled.


http://www.nigerianinquirer.com/2010/06/09/lamido-sanusi-on-the-asset-management-corporation-of-nigeria-bill/

interesting interview on the link above. I don't trust the Charles guy though.

CBN: Shareholders Now to Recapitalise Rescued Banks

The flip flop policy changing continues


The Central Bank of Nigeria (CBN) has enhanced the participation of shareholders in the recapitalisation of rescued banks by bestowing on them the power to midwife the process.
They would also take the final decision on who invests in the financial institutions.

With this development, the apex bank has heeded to the wishes of the shareholders, who have been clamouring that they be allowed to recapitalise the banks.

Addressing stakeholders of the rescued banks in Abuja yesterday, CBN Governor Sanusi Lamido Sanusi, according to a statement made available to THISDAY, said the apex bank would not usurp the rights of shareholders.
He assured them that the final decision on recapitalisation rests with them.

Present at the meeting which was chaired by Sanusi were the boards of directors of the rescued banks, their management as well as shareholders. The meeting was the second in the series of dialogue initiated by the CBN to ensure effective collaboration in the process.

Sanusi was also said to have reassured them that having secured the depositors’ fund with the reform programme, the focus of the CBN now is to salvage some value for the shareholders.

He made it clear that the CBN would not sell the banks, as it is not the business of the banking watchdog to do that. The CBN, according to Sanusi, only recommended some reputable financial advisers who are working with the board and management of the banks to source and negotiate with any of such investors.

He emphasised that the process of repackaging the banks is being driven by their board, some of which have held discussions with strategic partners, without direct involvement of the CBN.

“The Governor reassured the stakeholders that the shareholders would definitely play an important role in the recapitalisation exercise and that the process of giving value to their shares is already assured with the coming on board very soon of the Assets Management Corporation Of Nigeria, (AMCON),” the CBN statement read.

“On the issue of on-going litigations against the CBN, it was noted that a few individuals took the action without the consent of the seven zonal shareholders associations and that these few individuals who went to court only did so for personal reasons, as such individuals do not represent the opinion of the shareholders," it added.

The CBN, however, said that if the on-going process to recapitalise the affected banks is not successful, the apex bank would have no other option than to go for liquidation as provided by the existing legal framework.

Sanusi noted that liquidation and nationalisation are not desired options for the banks, stating that he is convinced that fresh injection of capital through strategic partnership remains the best approach.

The stakeholders, according to the statement, commended the CBN for reaching out to the shareholders and urged that the two options of liquidation and nationalisation should not be considered.

They also recommended that the CBN should go for the option that protects both the depositors and the shareholders and promised to consult with other shareholders to withdraw all court cases. Besides, they advised that the new management put in place by the CBN should be communicating with the shareholders regularly.

The CBN had some months ago engaged the boards of the banks and their major shareholders to a similar meeting, during which it urged them to support the recapitalisation programme or risk losing their investments.

The CBN governor has said repeatedly that the recapitalisation programme is in the interest of local investors who stand to regain their lost investments in the organisations after their recapitalisation, the recovery of reasonable portion of bad loans and the return of the banks to profitability.

AMCON set to take off in about a fortnight, after presidential assent to the bill, it is believed that all issues surrounding the recapitalisation of the banks would be resolved.

The CBN intends to clear $10 billion (about N1.5trillion) of bad loans from the banking system by the end of this year, in support of the recapitalised banks.

Sanusi said recently that bids on the banks would be released by September or October this year, adding that four international banks were among the likely bidders.
He said bids on the banks are to close by the end of July.

Sanusi recently said he is optimistic about the rescued banks’ recapitalisation. “Foreign investment in Nigeria is expected to rise as investors bet on rising oil prices, increased Nigerian oil production, and improved regulation of the banking sector," he stated.

The rescued banks are those the monetary authority found in “grave financial situation” following the joint examination of the CBN and the Nigeria Deposit Insurance Corporation (NDIC) and the release of the findings on August 14 and October 2 last year. The banks are Intercontinental Bank, Afribank, Oceanic Bank, Finbank, Union Bank, Bank PHB, Spring Bank and ETB.

http://thisdayonline.com/nview.php?id=178453

@justdtruth, nice comment

Sanusi has responded to the punch article below

http://www.cenbank.org/out/2010/pressrelease/gov/PRESS%20STATEMENT-Re%20Nigerian%20banks%20as%20gamblers.pdf

Mallam Sanusi reiterated that with the reforms, Nigerian banks have stabilized with many of them back to profitability. According to him, “our banks today are in better shapes than many of the European banks although there are still challenges that are being addressed”.

Meanwhile, I will like to quote him on this in the future. However, when such disclaimers are made, I believe CBN should have given us his entire speech at the lecture to actually confirm what he said exactly.

On the other hand, i think SLS is probably as qualified for the CBN role as any other Nigerian.

http://punchng.com/Articl.aspx?theartic=Art20100710262423

Governor of the Central Bank of Nigeria, Mr. Sanusi Lamido Sanusi, on Friday, in Asaba, described most Nigerian banks as gambling centres.

Sagamite:
You said:

I am pretty sure the non-performing loans you referred to are the ones of the 5 banks since that is what we were discussing here.

So based on the highlighted, mate, you did give statements that it was legal, whilst loaning money above a limit guidance by CBN is illegal.

That logic baffles me.

Please read my comments properly, there’s no where I said friend and family loans are legal, especially if they are not appropriately structured or collaterised.

I have also never stated that it was wrong to carry out the reforms, what I have questioned is the manner of approach.

If I was referring to non-performing loans of the 5 banks alone, why do I refer to the other 19 banks if you go through my other comments earlier in the week?

Your ever so “logical reasoning” will make ASSUMPTIONS when you should just take my words as they have been stated or ask for more understanding on my view. Please dip your hands in some water and wash your face to see exactly what I stated.

If you do your research and analysis well, you will find out that some of these loans that CBN is talking about were collaterised, but the value of some of the collaterals got impaired eg stock market crash. This was also caused by banks giving loans to value of shares at 100% without discounting for the effect of a loss in value.

Some of these F&F loans were given in the name of SMEs (Small & Medium Enterprises which was encouraged by this same CBN). They expected 10% of profits of each bank should go into SMEs. The CEOs obviously mismanaged it, but what were the CBN investigators doing over the years? You shouldn't cure a disease without getting rid of the symptoms or even investigating the causes of the problem or the root factors that allowed the disease to surface and eat into the system. They were part and parcel of what created the enabling environment for bank executives to get greedy, till they choked. 

If the banks were wrongfully giving loans to friends and families, does CBN not have its blame for making the situation reach such unbelievable levels before taking actions? Maybe not!!! I still think the ex CBN Governor should not escape a probe. This probe should run simultaneously with the court cases against the sacked CEOs and other Directors.

You once said I believe he has a hidden agenda, that’s even looking at my view mildly to suggest he had/ has an agenda. I believe he had no proper agenda!!!
Northern or Muslim agenda my foot, I have family and friends from many corners of Nigeria, many religions, many works of life, i won't play that card. Even if he does have a hidden agenda, the current President is from Bayelsa, why hasn’t he sacked him?

A lot of events post sacking of 5 CEOs reveal he is not as racy as before, taking more time to plan his next moves, carrying all stakeholders along etc. He appears to thread with caution nowadays. It shows some of our leaders are ready to learn.

When you have some time, please go through the link below, it shows you a few things the CBN Governor should have thought thru b4 applying somehow dictatorial hands on managing a big crisis.

http://www.hg.org/article.asp?id=19248

Below shows you how 22 banks were covered up for using Creative Accounting, but I trust you to say they are conjectures

http://www.sunnewsonline.com/webpages/news/national/2008/jun/07/national-07-06-2008-001.htm

Sagamite:
A guidance is not a law. At least most are not.

A guidance is an advice that you has different levels of enforcement. A law is non-negotiable.

Breaking a guidance is seen as questionable/risky/misdemeanor in most cases, breaking a law is illegal.

And I am pretty sure guidance on how much to lend would not be in Nigeria's statute books, so I am struggling to understand how you see such as "illegal".

Do you understand the meaning of illegal now?

This doesn’t look like the grammar section, so pardon my grammar.

The CBN Act Section 39 subsection 5 (please note that Bank = CBN and bank = licensed bank)
(5) The Bank shall have power-
(a) to require that all applications to any bank for loans exceeding such amount as the Bank may
specify shall be submitted by the bank to the Bank for approval and no such loans shall be made without such
approval;
(b) to fix a ceilings on the volume of loans, advances and discounts outstanding at each bank and it
may fix different ceilings for different categories of each such loans, advances and discounts;

From the above CBN Act, it was illegal for FBN to have given a loan beyond the prudential guideline of CBN in the first place, hence they sought a waiver thereafter. If it wasn’t illegal, or better still against the rules of banking regulations, why would they need a waiver?

Listen to your quote, “A guidance is not a law. At least most are not”. Does this statement mean you agree guidance can be seen or taken as law sometimes?

Anyways, you can have a look at some of the revisions to the prudential guidelines in the link below if you haven’t already had a look at it

http://www.proshareng.com/news/singleNews.php?id=10584

http://www.cenbank.org/OUT/2010/CIRCULARS/BSD/Prudential%20Guidelines%205%20May%202010%20Final.pdf

The above link shows you there are various guidelines on how much to lend!!!

My guess is that your opinion states that if a bank then decides to flout the prudential guidelines, it is quite acceptable as long as they seek a waiver. Well said if that’s the case.

I think you should also realise key elements of prudential guidelines remove some discretion from bank management and replace it with rules in decision making.

Thank you for explaining illegal to me. I truly appreciate it.

I will keep responding to your other comments in due time.

@Saga
We reach common ground in the fact that he should have acted robustly, but did we need all the press? The way you manage a very dire situation will dictate how fast and well you come out of it. Punishment alone does not make all wrongs by the CEOs right. There is zero confidence in Nigerian Banking sector at the moment and foreign businesses have evacuated their cash balances abroad, leaving just working capital available in our shores.

Sanusi has flip-flopped a few times on this reform issue:
His initial statement that AMCON will buy all toxic assets, to a recent statement saying that the AMCON might not be in a position to absorb all the toxic debt.
The reversal of Mike Adenuga’s role as a Non executive Director.
Publication of a list of debtors with so much pomp and pageantry, but the names that were wrongly put on the list were not publicly recognised, which could have led to such company’s reputation being tarnished for life.
His denial that he was going to sell banks, then the reversal to state CBN will sell the banks or rather search for core investors for the banks.



I have defined ILLEGAL in my previous post. Illegal to me is anything unauthorised by law.

I am not sure where you got the impression giving loans to family and friends is seen as legal to me.

I should learn to make comparisons? I am shocked at your lack of logical reasoning here. I am not comparing lending above single obligor limits to lending to friends and family.
My argument is that you should take stakeholders interest into cognisance when you attempt to clamp down on irregularities or criminal actions.
Consistency (Uniformity) in putting adequate measures in place to address issues. He did very well in the FBN transaction, but i mark him a lot lower in how he managed the  5banks without a proper plan. He has back pedalled lately and seems to have lacked the venom to fast track his reforms.

You have stayed silent on how ineffective some of the post CEO sack plans have been. Could he have done a lot better? Yes.

Your points noted.

Illegal to me is anything unauthorised by law.
If FBN already had a waiver from CBN, then why did they need a temporary waiver again? Was it because they breached the initial waiver given to them or it expired or there was never a waiver in the first instance until their books were checked?

I agree single obligor limit is not cast in stone, but CBN has given us guidance of 10% and I even mentioned earlier of banks using 20% as a guide.

I am a shareholder in FBN. I haven't sold my shares becos I personally believe they can sort this facility out and create wealth for me, however little.

If they take possession of the asset, don't you think the value of the asset will be impaired? Who do you think will buy the assets from FBN Trustees? Can you show me evidence of the assets being valued at over $1 billion? If indeed the assets are valued at over a billion dollars,  then i rest my case.

I also like the fact that you refer to fellow nairalanders on a nickname basis.

PS: you seem to be doing reasonably well in the fantansy football section.  

"The fragility of the economy dictates that offenders be interdicted without damaging the sector." – Gen. Gusau

"If you are in a system prone to panics, the last thing you want is to advertise that an institution is in trouble". - Tim Congdom

Sagamite:
Now, I don't see the relevance of this story and why you brought it as evidence.

You don’t need to get too emotional about this.
We are talking about “CBN Reverses Itself, Clears Sacked Bank Executives For New Jobs” here and how the financial crisis was handled and you are picking up on non-performing loans as your area of interest!!!
I think you need to consider the topic yourself next time. You decide to respond to only the part of that suits you or you think you have ammunition to battle with. 

Sagamite:
Is the loan a non-performing one?

A non performing loan is better than an illegal loan in my own opinion. Even the greatest businessmen have put banks in a situation of having non performing loans in their books.
A non performing loan can be a legal loan approved within the limits of a bank which later goes awry by whatever means, while a loan (whether collaterised or not) beyond your single obligor limit without a waiver in the first place is an illegal loan.

Sagamite:
Has it put FBN in a position where they can not continue performing their operations on a daily basis for a long length of time without CBN intervention?

There is no where I have stated it is a non performing loan. What I meant is that it was beyond the allowed limit and could put the bank in a detrimental position if it ever becomes non performing. The same reason it was restructured from a bridge loan to a mid term loan might be the same reason it could be restructured to a long term loan (oil price fundamentals)!.

Were the 5 banks not continuously operational as at the time Sanusi waded in? Were they not open and meeting customer demand for their deposits? Are you confirming that the 19 other banks are not currently benefiting from CBN intervention?

Sagamite:
So how has Sanusi not been consistent?

No matter how bad the CEOs have acted, He could have tackled the problem aggressively, but with caution not to erode investor confidence. That is where the CONSISTENCY comes in. There’s nothing like a big or small thief, a thief is a thief. You should never make one thief look more attractive than the other.

Finally, it’s been a year since these investigations started, but no one has mentioned probing the activities of the ex CBN Governor and the role he played in allowing this mess to go unchecked earlier. Is he scared to start that probe? Does that mean he is setting a precedent, so that his own tenor is not probed? We need to know the role played by certain people in covering up the mess.

Anyhow, I just hope he and his team are able to sort the mess we are in before it’s too late.

Sagamite:
Mate, this is jargons to me.

Explain things in simple terms. I am not an accountant.

Apologies if you got caught there, I am not an accountant either.

It simply means FBN Plc provided a loan to one of its customers. The loan amount was approximately 30% of its shareholder's funds (share capital, revenue reserves, other reserves, retained profit etc). Ideally, you would expect this to be no more than 10%, although some banks use 20% as a maximum single amount loaned out to a single borrower.

They somehow got a waiver from CBN, but this waiver should have been requested for even before loan is disbursed to the beneficiary.

Anyhow, I personally understand why no one went punished in this case but as a regulator you need to deal with issues in a cautious and consistent way. Most important is to protect stakeholders and shareholders.

The banking reform was quite abrupt, didn't seem well thought through (or maybe it was), the consequences of his action is still being dealt with in a reactionary way atimes instead of on a step by step basis that would have been expected if their was a proper plan. He has flinched a lot, we haven't heard much about the list of debtors published. don't you think they should have followed up with this aggressiveness.

They set up AMCON (Asset Management Companies) which are still not fully operational after approximately a year after reviewing the activities of the 24 banks. Eventually govt might have to take up these debts.

@tkb417
Your reaction is very much expected. Whether a bridge loan, or mid term facility, whether waivers or no waivers, it is poor to assign such facility at that level of shareholder funds. They didn’t need to risk it all on their own and they could have clubbed the deal together with some other banks.

Another flaw is that they applied for a waiver when the bridge loan had been converted. Don’t you think they should have secured a waiver before disbursement of the bridge loan in the first place?

Just a reminder to you that because a loan is adequately collaterised should not be the main reason you approve a loan. You must disburse a loan within your capacity as a bank, within the rules.

Is the asset easily realisable in the market? I dont doub't the quality of the management team, but if the fundamentals for providing the loan in the first instance with oil price at over $100, when do you expect oil to trade at that level again?

I hope you realise Longe’s sack has been reversed by the courts…it was the same First Bank board that gave verbal approval for the IIL transaction to go ahead. This is not important right now though.

I never compared this case to uncollaterised loans, I only believe what is wrong is wrong. The same CBN managed First Banks situation in a way not detrimental to investor confidence, however, they didn’t manage the other banks in as good a manner. I will keep reiterating the fact that the CEOs should have lost their jobs and if possible face the full brunt of the law, but you don’t do such haphazardly.

Just FYI, I only brought this up because it is publicly available info and verifiable. How much more other deals in the cupboard of so many other banks. conjectures right?

http://www.proshareng.com/news/singleNews.php?id=8940

@Sagamite,
Kindly see link above. Is there any reason why First Bank should be allowed to provide an asset to a customer which is circa 30% of its shareholders funds which is way beyond the single obligor limit of 10% of un-impaired capital?

This brings to air some sort of favouritism in dealing with the financial crisis in Nigeria.
I believe the same Sanusi has his roots with First Bank.

Spyker:
It will never work. By the time these new generation churches start calling the special adviser "Anti-Christ", he will shut his mouth up.
I also think the Special Adviser should merge some small churches and mosques together to form a bigger church and mosques respectively.

Are you sure the adviser is not an Anti-christ or anti-Mo already!!!

Remii:
Pele by far, he is the youngest man to have played in the final of world cup, the only man with 3 world cup medals. When he visited Nigeria in 1978 in the match btw Fluminense FC and Nigeria 11, that guy dribled everyone on the pitch, he took the ball from one end to the other and back without anyone been able to tackle him.

In 1967, the Nigerian Civil War had a 48-hour ceasefire to watch Pelé play an exhibition game in Lagos. http://findarticles.com/p/articles/mi_m1608/is_2_22/ai_n16071178/

Maradona is great, no doubt, but man pass man, he did not win World cup 86 alone, infact in the final match, Buruchaga scored the winning goals.

I recollect a certain Mr Diego laying the penetrating offside beating pass that led to the goal!!!

o9999:
Its almost like the case of beckky and jay-jay. If not for english media hype can u differentiate the 2.

They are never to be compared. Beckky is hardworking but jay-jay is the definition of football!!!

number 3 will only be right if the guy you are referring to said Pele was never the worlds best player in his time!!!

Sagamite:
I must say, first of all, that what you just stated has nothing to do with provisions. It is more a loan approval process that sounds reasonable.

Now what is the penalty for breaking those guidelines?

Sack of the management? I doubt, if the loans do not put the bank at serious risk.

I don't know what evidence you have about other banks. Do you?

The 5 banks whose management where sacked had brought their banks to its knees. Evident from the incapacity to continue operations without the EDW. They had put their banks at serious risk, not just participated in rules breaking.

I will free you with your logical opinion.

I wasn't talking about a loan approval process , i was talking about the procedure to classify a non performing loan, what you have to do to a non performing loan or how to turn a non performing loan back to a performing loan.

I implore you to read my earlier posts, I have not defended the 5 banks,
“I think Sanusi could have handled the job in a sleeker way, although at the same time i recognise he had to do a bulldozer job, or else the Naija factor might have crept in.”

Sanusi’s double talk and body language in recent interviews show he wasn’t very prepared for the consequences of his actions / inactions.

Sagamite:
Loaning money to themselves, buying personal jets, awarding themselves unjust bonuses all at the risk of others (with less social powers) financial collapse?

There is at least 1 CEO that falls under this category and still has his job till at least 2mrw evening.

Sagamite:
Explain what you mean by making years later.

A bank should provide for its loans if they become substandard, doubtful or bad within 360days and not renew a non performing loan without it becoming a performing loan in the first instance. Hence, the huge rush to provide for loans reaching unprecedented levels in all banks in Nigeria. it's just in vogue now.

All banks usually renew, reschedule or roll-over non-performing loans without necessarily checking the ability or capability of the customer to repay. The CBN prudential guidelines need you to pay back most of the loan if not all the loan / interest payment before the banks can reclassify the loans as performing again.

Non-performing loans should be classified into 3:
Sub standard
If principal and/or interest is not paid between 90 to 180 days.

Doubtful
If principal and/or interest is not paid between 90 to 180 days and are not secured by legal title to leased assets or perfected realisable collateral in the process of collection or realisation.

Bad
If principal and/or interest is not paid after over 360days

Sagamite:
My friend, I repeat, ALL BANKS MAKE PROVISIONS for non-performing loans.

Do you comprehend?

Are you saying it was a lie that the banks were utilising the CBN EDW?

Are you saying it is a manufactured story?

What utter gibberish when you have no logic to present. You come up with mere conjectures.

All banks make provisions, but these provisions should be made immediately and not years later.


I will rather make conjectures than bear false witness.

Sagamite:
You got it all wrong!!!

The fact that banks made losses on debts does not mean they have flawed risk management process. ALL banks across the WORLD make provisions for non-performing loans and make a loss.

It is a Risk MANAGEMENT process, not a Risk ELIMINATING process.

No bank operates without some non-performing loan. Giving loans is a risk, not a guaranteed return.

Which banks are you aware CEOs committed offences and what evidence do you have?

After some of the banks got into trouble, they were utilising a CBN borrowing facility to remain in business. A facility, that if not available means they would have had to close down. 5 banks were found to be consistently responsible for utilising 90% of these facility. A grossly disproportionate percentage.

The facility was created for short term and infrequent use, but it became a frequent lifeline for these banks, hence triggered the red flag in CBN.

You decided not to read the part that stated make PROVISIONS for their non performing loans they had been rolling over for ages

Do you have any evidence against the bank CEOs sacked? Its just stuff you read on national dailies!!! My point is that CBN investigators decided not to use the evidence against certain banks that were politically correct.

I will like to insist that interbank lending stalled hence financial crisis in Naija emanated. There was also a rumour that CBN was going to close some banks, hence banks became scared to lend to each other.

BTW, does the facility which was created for short term and infrequent use have a name? Maybe I could learn from this.

bisiaet:
So the attached picture is what you mean by Maradona single handedly won a World Cup this is interesting.

I think the attached stated the CLOSEST you will ever get to single handedly winning the WC.

That was a WC semi final match in 1986 and 6 defenders trying to get the ball off him. He scored 2 goals (one of them dribbling 3-4 players) in that match.

Just imagine he had another Maradona or maybe a Messi or C Ronaldo was already born in his generation, then you can only imagine what would have happened in that match or others.

Sagamite:
The CEOs had non-performing loans that they could not show they followed due risk management processes in approving.

These loans were to themselves or friends (mostly bigmen and board members) without any collateral. Without collateral means, if the borrowers are unable to repay the loans, there is no assets of theirs in your custody you can sell. This means their is a high chance the money would be lost with minimal chance of recovery of any fractions.

Risk management processes within a sane bank would not allow one to give such huge sums without collateral.

The fact that these banks were running to the CBN to get money to remain in operations due to lack of cash flows mostly due to the non-performing loans is incriminating enough to show the Executive team of the banks are incompetent and very due for a sack.

The investigation afterwards is just to find who and who's actions has not only been incompetent but criminal so as to present it to a court so their arse is jailed for risking people's pensions and savings.

I believe all the universal banks (24 of them I think) were all operating under flawed risk management practices. If you study their annual accounts most of them made losses because they had to make PROVISIONS for their non performing loans they had been rolling over for ages.

Even some banks i am personally aware of came out of these investigations unscathed even though there was evidence int heir books and records showing they committed same offences as the CEOs that were ousted, maybe not as bad though.

Just a point I noted, I do not believe the banks borrowed money from CBN, rather it was from other banks and part of what escalated the problem was banks not wanting to lend to each other. CBN gave loans to ease the operations of the banks that were found wanting after CEOs were relieved of their duties.

Please see attachments!!! This is the closest i can get to singlehandedly winning a World Cup.

blkmum700:
Following Diego Maradona’s controversial comments about Pele yesterday, Carlo Garganese asks the question: Who was the greatest?

I will go for Pele he has more record than Maradona and he is also a cheat he cant play football without cocaine. Lets hear your comment here.

I don't support the use of cocaine, but Cocaine only makes it worse to play football. Maradona could have been a far better player had he not gotten addicted to cocaine when he was in Barcelona!!!

Sagamite:
If you hired someone to guard a set of 100 high-security vaults with valuable contents. The guard lives in the premise of the vaults and is the only one with access to the vaults. It is common knowledge that the guards are usually complicit in stealing contents from the vaults. You have periodical times you come to check if everything is secure and on one occasion of these checks you find that 4 of the most expensive vaults have been looted but there is no evidence of a break-in and the guard has no explanation of how anything went missing.

Do you leave him to continue guarding the vaults whilst you investigate how the 4 vaults content got missing or do you replace him before the investigation to safeguard the remaining 96 vaults?

I am not aware the Bank CEOs were given the opportunity to defend or incriminate themselves further. The rational thing in my own opinion was to suspend these CEOs and Directors pending investigations, court cases and convictions/acquittals. If after court cases spanning over 10 years, the CEOs are vindicated, the shareholders will bear the burden of having to pay the CEOs salary's for that period, compensation, etc


I think Sanusi could have handled the job in a sleeker way, although at the same time i recognise he had to do a bulldozer job, or else the Naija factor might have crept in.

I suggest victims and non victims (especially high value accounts) should have 2 accounts with each bank they transact with. One serves as a savings account and the other can serve as a spending (whether current or savings) account.

Make sure the savings account has no ATM attached to it.

If you need to withdraw, you transfer from savings to the spending account either online or calling your account officer to oblige you.

Also, avoid responding to emails requesting for information or confirming information to you. Always get in touch with your account officer. Every customer has an account officer assigned to him or her, Now for the 4.5m guy, he should actually have an exclusive account officer.

Anyways, its not the best solution i have up here, but reduces the effect of losing cash.

In preparation of tonites match, Nigeria have hired a new COACh. It picks them up tomorrowe and takes them home!!!