₦airaland Forum

The government has already paid N8.05 billion, representing 70 per cent of the contract sum to the Chinese company, to design and build the 27 kilometre project expected to run from Okokomaiko to Marina.

Beaf:
@PapaBrowne
We are on the case for launch, Friday. Thanks so much.

beystwin:
PapaBrowne, thanks for your analysis and the figures.
KnowAll, thanks for providing the idea that Odua Investments could fund this project.
Another way that a project such as this one could be funded is through the Federal Government. On completion of the project, they could sell shares to the Nigerian diaspora, thereby solving the problem of how to finance this project. Also, this way the Nigerian diaspora would be part of the board of trustees, as well as be involved in management, which could help ensure that the project does not fail and is maintained as well. I, for one, would be ready to buy shares in a project such as this one if this helps ensure that it is carried out appropriately.
Furthermore, this could also be a great investment opportunity for Nigerians back home. Overall, I think it can be done.

kosovo:
hOW COME no one is seeing what i am seeing

Ibime:
So whats the issue here, that Okonjo is wrong, or that Jarus was being "deliberately misleading" about Okonjo's position. . . . either Papabrowne is right that Okonjo is for the reforms, or Seun is right that Jarus misread Okonjo's position about the reforms. . . . . connundrums, connundrums. 

violent:
@Seun, Kosovo, Aisha2, Mukina

[size=13pt]This is an example of the kind of topics we hope to discuss in a development section[/size]

While citing bad conditions in order countries, she said: "I am pleased to note that several steps have already been taken to limit moral hazard, including dismissal of the CEOs of the banks receiving liquidity support; publication of lists of all major non-performing borrowers; and pursuit of responsible bank managers and borrowers by the Economic and Financial Crimes Commission (EFCC)".

violent:
Bump!

SANUSI’S FIRST BANK: THE MAN’S HYPOCRISY AND DOUBLE STANDARDS

Apr 6th, 2010 | By Victor Shodipo | Category: Issues


The statement below is an excerpt from an Equity Research Report of StanbicIBTC Plc (StanbicIBTC is a leading investment firm and deeply involved in CBN’s reforms as Adviser) published in ThisDay of Sunday, March 21, 2010, page 31.

“Given First Bank of Nigeria’s exposure to the oil and gas company SeaWolf, the bank faces risks of oil price volatility and instability in the oil and gas sector. The bank’s credit exposure to the company is currently about 29% of its shareholders’ funds. The CBN has instructed the bank to reduce its exposure to 20% by 31 March 2010. The bank intends to sell down its exposure to 15% but we do not believe this is likely because of the current low risk appetite in the (banking) industry”.

In July 2007, First Bank provided SeaWolf a US$260m bridge facility for the following:
• To acquire 100% of the equity of Mosvold Jack up Ltd (a publicly traded offshore drilling company quoted on the Norway Oslo Exchange)

• To make scheduled payments for two rigs under construction (MSV 104 and MSV, renamed Oristetimeyin and Onome)

• Make down payments for the purchase of West Titania (now Delta Queen) from Seadrill and;

• Meet operational and administrative expenses.

The global economic crisis, which resulted in a huge dip in oil prices, had a negative effect on the quality of the loan and the bank had to convert some of it to equity and also extend the duration due to low cash flows from the project.
Source: Thisday, Sunday March 21, 2010.

This loan to a single company is currently 29% of FBN shareholders’ funds according to the Stanbic IBTC Plc equity report. As at September 2009, First Bank’s Shareholders funds stood at N309 billion. 29% of this comes to N89 billion. This means First Bank’s current exposure to just a single loan is N89 billion well above the 20% limit set by the CBN!

It is important to note that this loan is not performing as expected hence the bank’s initiative to convert part of the loan to equity and sell a portion.
The Daily Independent Newspapers, it will be recalled on January 20, 2010, had done an extensive report on the shady dealings that went into this facility which was given when Mallam Sanusi was the Chief Risk Officer of First Bank and later supervised as its MD/CEO.

Despite the fact that this loan is of doubtful recovery, the CBN under Mallam Sanusi turned a blind eye to this facility. First Bank’s total provision was N29 billion when it should not have been less than N118 billion if the provision for SeaWolf alone is added. This loan also raises more fundamental issues.

• What sort of ‘Risk Expert’ will approve the granting of an N89 billion loan to a single company that as at the time of collecting the loan was less than a year old?

• The Company was incorporated the same year (2007) it applied and got $260 million facility from First Bank of Nigeria Plc.

• Is it not hypocrisy that the same Mallam Sanusi that recommended the approval of this loan now turns round and refers to other bank MDs’ as reckless?

• What could be more reckless than risking 29% of your shareholders’ funds on a single obligor that has no track record in its industry of operation?

• Is it not the same global economic crises that torpedoed this business that also affected the Nigerian stock market for which reason Mallam Sanusi invaded the targeted banks?

The above report clearly further reveals the hypocrisy of the Mallam Sanusi’s largely personal attacks on the removed bank Managing Directors. This is a loan that has gone totally bad or at best has entered the stage of doubtful recovery.

While CBN forced its captured banks to make full and immediate provision for all facilities of doubtful recovery on its books, Mallam Sanusi has secretly given First Bank up to 31 March 2010, to “reduce its exposure to 20% of shareholders funds.”

Clearly, what is good for Sanusi at First Bank is not good for other banks.

MR. AG PRESIDENT, NIGERIANS COUNT ON YOU TO RESTORE ECONOMIC SANITY AND PROGRESS.
SIGNED

VICTOR SHODIPO
RENAISSANCE PROFESSIONALS
victorshodipo@renaissanceprofessionals.com

chosen04:
I though i was the only one that noticed-----

Innuguration--This is the English premiership way of spelling it?

19. Thus, I will be requesting a fortnightly briefing on the state of our economy from the economic team, which shall be constituted very shortly. This team, under the chairmanship of the Minister of Finance must help to fast-track the process of our development as this is the most important task in the life of our nation. Our present and our future depend on it.

naijaking1:
It is the patriotic duty of every Nigerian to support the RP or any group that seeks to criticie and challange Sanusi on his so-called reforms.
That's what democracy is all about: challenge, debate, and asses.
I can't wait donate money and goodwill to the RP group, because to lay silently while the bull damages the ban would be a sin.
Sanuis talks like a dictator, challanging him every step of the way will force him to walk like a democrat.

Sagamite:
You would command more respect if you quote whatever Sanusi said and prove with logical and high intellectual points of why you think it is weak. Don't just make a state that it is weak.

G: Are you saying that the Renaissance professionals are the same CEOs you
sacked?
SLS: I know the person that started it. I know about the N300 million that was the
seed capital. I know the person who went to Ghana and was collecting the money. I
know that there is a journalist who is a senior member of the Guild of Editors, who
started writing the adverts. We know the advisers that they have among capital
market researchers.
I will not claim to know everybody that is funding them, but we know the people who
set them up and we know the modus of their operation. But it is immaterial because
it is to be expected.
G: You don't seem to be responding adequately to some of the issues the
group has raised?
SLS: This is a response. I have said it before. Look at the issue of Atuche's property.
Has the Central Bank ever said anything on Atuche's property? EFCC is investigating.
We just removed everyday.
Even his lawyers published that there was campaign of calumny by the Central Bank
and the EFCC. The issue was that we removed him and we have our reasons for
doing that. If he goes to court, we will bring our reasons for removing him.
G: But you were once quoted as saying that you would send the EFCC after
some of these CEO's,
SLS: When we removed the MDs, we removed them for putting their banks in grave
situation, and we had the right to do that.
Now, whether there was a criminal activity or not is a different matter. If in the
course of those examination or even after we take over the investigation, we find
that there was a fundamental breach of trust and criminal activity, we will hand that
over to the appropriate authorities and tell them that this is what we have seen;
come and investigate.
They send their detectives; they investigate, prepare their charges and arraign them
in court. We have told EFCC; we are not the judiciary. But we have the responsibility
to report criminal activity to the authorities. But that has nothing to do with the
EFCC's investigative work. Where they find some assets that belong to people and
freeze those assets - that is part of EFCC work.
I'm not saying that the CBN should dissociate itself from EFCC. But it's very
interesting that nobody will ask where the CBN has said something about assets
belonging to some people.

Sagamite:
Who are many?

Are you saying you know who the RP poeple are?

Sagamite:
You would command more respect if you quote whatever Sanusi said and prove with logical and high intellectual points of why you think it is weak. Don't just make a state that it is weak.

So you believe whatever you read based on what the author says? Especially a faceless one? They said that is how they met, and you chopped it based on that statement alone?

darqly:
I beg to disagree strongly on this one. [b]The so-called renaissance pros are just involved in cheap blackmail and a public smear campaign against sanusi. [/b]Why did they keep mum until he started flushing charlatans out of the banking system vis a vis reforms? What is the source of the income, the huge war chest they are using to finance this obnoxious monologue? What do they hope to achieve or stand to gain- that the reforms be reversed?or Akingbola et al be reinstated to continue their come-chop banking? Or should he re-value their stock which had been obviously overpriced and are now a true reflection of their operations? There is nothing professional about their slapstick campaign so far in my opinion.