₦airaland Forum

Sanusi has cleaned the banking sector.
I think his next step is to revigourate the banks.

He'll then learn the hard way that none of the major banks and businesses in the world are clean.
I have argued this with a lot of naive minds and have decided not to bother.
Everything that happened in Naija happened in US,UK and Europe.

@biina and co
You don't seem to get it.

5 Nigerian Banks were living of the EDW.
RBS, Lehman Bros, Bearsterns,Nothern Rock(Just to name a few) where practically running of borrowed money from the interbank credit system.
Nothern Rock failed the moment it could no longer secure loans to run its day to day activities.
An Identical situation applied to Bear sterns.
RBS, HBO and Meryl linch all secretely cried distress to the government the moment they couldn't get credit.

Nigerian banks were doctoring their books.
How can you explain the fact that in Europe, UK and US, Banks which declared huge profits in one quarter immediately started declaring huge loses the immediate next quarter after they had been urged to come clean.

Banks where heavily exposed to the stock market.
Same everywhere and they all got their fingers burnt.
This is the global recession for you.
Sanusi did not understand that the Nigerian banks where part of a global financial institution.

There goes all the similarities.

No bank executives were sent to jail by government.
Government only sacked executives only after they had assumed a huge majority stake in the banks thereby executing their boardroom powers rather than some government act.
Even after the bank executives had been removed there was no law alienating the seasoned  players  from the banks as a whole. This single action of Sanusi by alienating the top Brass in Nigeria Banking sector is completely reckless and uncalled for.

The banks approached government to bailout after they had exhausted all alternatives and not the other way round as in Nigeria's case.

Sanusi actions are already causing a long term crisis of confidence in the banks.
Even today the NNPC was looking at the possibility of securing funds from foreign creditors in the event that it privatizes.

A few years back , 1 bank financed the Transcorp Nitel deal.

You are here talking about figures.
Did you ever get the details of the stress tests in the US ?
His inexposure to the bigger picture is so glaring.

Yes it is easy to criticise
name everything in history including the various stimulus packages, people will criticize it.

Sanusi has bigger problems.
Apart from being criticized by many Nigerians, he is indirectly being criticized by the Ministry of Finance.
Who are in effect questioning his judgements even while he is still in office.
Im beginning to loose confidence in the guys abilities.

His released blueprint have been condemned as incoherent, lacking intellectual content an immeasurable without any clearly defined targets.
Also his plans have been lambasted my many as mainly being a continuation of Soludos.

The Central Bank and an inadequate blueprint

NIGERIANS were justifiably alarmed when recently the Minister of State for Finance, Mr. Remi Babalola drew attention to the absence of a codified plan of action by the Central Bank of Nigeria (CBN), noting that it appears the CBN Governor was operating public policy on the basis of an "as the spirit leads me'' impetus. The Minister confessed publicly that the Government had in the recent past abdicated to the CBN some crucial responsibilities in its desire to achieve a sure-footed autonomy of the CBN.

Clearly, the Government has woken up to a rethink, and now seeks to "be more involved''. This is a welcome revision. In previous editorials, we had expressed concern that there are indeed too many decisions being made and imposed by a motley of public servants without accountability and responsibility to the Nigerian people, a contradiction in the context of democratic ethos.

Within days, the CBN issued a refutation of the Minister's claims and has since presented what is touted as a blueprint with a 10-year run out for banking sector reformation. We are dismayed by the content, the presentation and context of the CBN's attempt at a so-called blueprint for reforms. It does no credit to that institution with the capacity of its once fabled research department and its reputation for quick hire of top notch advisers to present this document touted as "Four Pillars for the Banking Reform''.

First, the content has, unabashedly, no sufficient originality as would be connected to the direct experience of banking supervision of the past one year or convey to us, the banking public, that these are adequate responses and justification for the decimation of the banking sector.

Omnibus expressions such as " Enhancing the quality of Banks'', "Establishing Financial Stability'', "Enabling healthy financial sector evolution'' are the first three pillars and save for the fourth, "Ensuring Financial sector contribution to the Real Sector'' appear mealy-mouthed and inchoate for the Nigerian economy to bear over 10 years. It may not be uncharitable to ask from the CBN if these same initiatives were absent from the 2004 Banking Consolidation Agenda announced by the then Governor. The CBN has rushed out an amorphous, immeasurable programme and given it a life-time that is unambitious and thoroughly tentative when it could have, with specific amendments, created a continuum with the erstwhile 13-point document of 2004.

We believe that a responsive banking and monetary policy response has to be short and pointed enough to put out the pains and losses in the immediate environment; secondly, position the banks through the absorption of toxic assets to lend in a bold and direct manner, but not exclusively, to the real sector so that the production indices will show true and verifiable growth and not the serial media releases of statistics. We fail to see the potentials of the CBN's new reform plan in this regard. Thirdly, the reform due within the bloated and expensive CBN does not get the urgency and seriousness Nigeria deserves.

For its presentation, the document falls short of giving confidence. Given the penchant lately for a debasement of roles and standards, it is necessary to remind ourselves that this document when signed off by the CBN Governor actually belongs to the Court of Governors of the Central Bank of Nigeria where he is presiding as Chairman. It should be of concern to this board, which should be a moderating influence, and many Nigerians that a document of this purported import would be primarily unveiled as a University's Pre-28th Convocation Address!

This is not appropriate and subtracts from the significance of the document, albeit an inadequate document which should go first to the banking constituency in a professional manner. We consider that this reflection of inappropriateness in language and occasion is part of the baggage the CBN should hurry to shed. The CBN as an institution is debased by this new example of arbitrariness and share of limelight. It is the duty of a correctly focused and independent Board of Governors to stem this habit.

Within the context of this reform paper, we find a plethora of issues that should be open to discussion, debate and perhaps civilised disagreements by those entitled to it. What, for instance, rationalises a segregation of banks into national, regional, specialised and international categories? Surely, it would not be the question of share capital alone because for the opportunities in this economy and the under-provision of several years, it is arguable that the current N25 billion may not be such a high enough ceiling. How many transactions under the impressive local content programme of the Oil and Gas sector would that finance?

To the extent that this is a discussion paper, and the CBN is flying kites, still working on the guidelines, Nigerians should have another chance to take up the gauntlet and seek responsible monetary and economic policies to shape the lives of the families and people. We must initiate an urgent reprieve to enable Banks take risks and stop criminalising enterprise. This document, as presented, is an exercise in uncertainty.

It is doubtful that Nigerians and even the Ministry of Finance would find the document meeting their own demand for a planned codified roadmap for a comatose and terrified banking sector. Unfortunately, it is not so.

http://www.ngrguardiannews.com/editorial_opinion/article01/indexn3_html?pdate=100310&ptitle=The%20Central%20Bank%20and%20an%20inadequate%20blueprint&cpdate=100310

While I do not agree with the writer above on every issue he has raised in this write up, but I have carefully highlighted areas where he/she has been spot on.

In the coming months weeks/months/years, these highlighted issues will become more pronounced.

Ethics or not, what the economy needs is a bouyant Banking sector.

An absence of this will be a failure on Sanusi's part !

Political impasse assailing capital market, say stakeholders
By Helen Oji

THE socio-economic stability, needed for restoration of investors' confidence in the nation's capital market, may have been experiencing unsavoury compromise, due to the political impasse over the country's Presidency.

Indeed, stakeholders, in separate chats with The Guardian over the weekend, stressed early resolution of conflicting issues from various political groups, to stem the tide of concomitant value depletion, arising from sagging investors' confidence in the stock market.

The stakeholders lamented that several weeks after Acting President Goodluck Jonathan had been invested with full executive powers to head the nation, discomforting currents, capable of undermining his capacity to perform the functions have been rising, with the potentiality of investors reacting negatively to the signals.

At the weekend, 12 members of the Federal Executive Council, under the aegis of "wise men", urged Jonathan to retain the status quo in the absence of ailing President Umaru Yar'Adua, even as the Chairman of the recently inaugurated Presidential Advisory Council, Lt. General Theophilus Danjuma, urged the Acting President to "get cracking", for posterity sake.

Managing Director of Dependable Securities Limited, Mr. Chenenyem Anyanwu, in Lagos, admitted that the tense political environment has been impacting negatively on the transactions in stocks.

He pointed out that no investor would agree to commit his fund in an economy with shaky political profile, especially the foreign investors, who, due to the global financial crisis, have adopted the "watch and see" posture, in the milieu of lingering political uncertainty.

"Of course yes, the political situation is affecting the stock market. Nobody would like to invest in a shaky economy. The foreign investors do not know what will happen next and the indigenous ones, who have suffered huge financial losses due to the share price meltdown, have chosen to adopt the 'watch and see' measure too. So it is affecting our market."

Corroborating his view, the Managing Director of Pivot Trust Securities and Investment Limited, Mr. Sunny Agoh, explained that when the polity is being heated up, as is the situation now in in the country, the economy is bound to suffer.

His words: "There is power tussle in the country and when there is power tussle, it is impossible for the person at the head to concentrate. And nobody is talking of the economy now and with this, it would be difficult for them to release funds.

"It is when people lay their hands on fund that things will start to work and that is when people can come to the market to invest. No country moves forward without addressing their political problems."

In his contribution, an investor with Vision Trust Investment Limited, Mr. Chibuzor Eze, said investments are being affected negatively, as a result of the political unrest.

According to him, long-term investors in the capital market want to hold on for now, until the political problem is resolved, while those that invest for short term are treading with caution.

"There is uncertainty in the country and all the sectors are affected, including the stock market. People are cautious on how they commit their funds and this limits the inflow of cash in the system. Nobody wants to commit his fund in a way he or she cannot come out of it easily.''

Nigeria's capital market has been described as one of the slowest recovering bourses in the world, even after being adjudged the worst performing in 2009.

The crisis was accentuated in the last quarter of last year, when the impacts of Central Bank of Nigeria's reform agenda, started hitting corporate Nigeria.

The apex bank's reforms, which were targeted at sanitising the banking sector, are yet to impact positively on the stock market.

How can one correlate the above with Sanusi's statement ?

Rastamann:
Why can't Nigeria divide into two or three. Enough of all these nonsense every time in the north.

Calling for the breakup of the country is an easy way that doesn't solve any problems.

The warring factions will still find themselves in the same city (Jos) in the same country.

So will Ijaw/Itshekiri and Ife/Modakeke.

In those breakaway countries you will also find armed robbers and theiving politicians 

it is his prerogative if he goes 2 court or not.
Whether he squanders his goodwill or not.

Under a democratic system everyone has the right to seek a redress in court.
That is what the judges of the various courts are paid for.

After all he is not using taxpayers money.
I know people who said same to Obi while he was going to court.

My friend that event is old. How come you just stumbled on it.

I think the man should be repatriated to Naija. To face our gay laws.

Ibime:
Sanusi has no power to affect the Presidential situation.

If he starts bleating that Yara absence is affecting investors, you all will start harping that he is affecting investors confidence.

In the meantime, it is important to let investors know that Jonathan supports the reform, and that reform will carry on regardless who is the substantive President. This stresses the relative independence of the CBN.

I wouldnt expect any CBN Governor to say different.

Good, and I appreciate his change in attitude.

Its good to see he is learning on the Job 
I have come to a conclusion about Sanusi.

He is an astute/principled banker of high quality and knows his stuff.

But this comments like many others hes made in the past, expose his macro-economic deficiencies.

He either doesn't know or knows but does not appreciate the impact of macro-economic/fundamental issues.
This guy expressed genuine shock when Nigerias credit rating was downgraded after he publicly intervened and bailed out a number of Nigerian banks

This has been evident since day one and has been his biggest undoing.

I'm not interested in this kind of stories.

But just to let you know

A singer in the Vatican choir had intimacy with one of the Pope's gentlemen-in-waiting and procured male escorts on his behalf, the Italian weekly Panorama says.

Telephone intercepts collected as part of an extensive corruption probe into Angelo Balducci showed that 40-year-old Chinedu Thomas Ehiem would find men on the "Pianeta Escort" (Planet Escort) website and set up encounters between them and Balducci in his apartment in Rome, the weekly said on Friday.

In an interview with Panorama, Ehiem said he had intimacy with Balducci "for five or six months" because of financial problems.

After a lengthy period without making contact, Balducci then got back in touch with Ehiem, asking him to organise encounters for him via the internet.

"He asked and I executed. He would give me 50 or 100 euros, never more than 1000 or 1500 euros a year," said Ehiem, adding that for Balducci "a 26-, 27-year-old man was too young. He preferred meeting mature people - 40 or older."

The last meeting between Balducci and Ehiem took place in January when Ehiem said he organised an encounter with "a dark-haired Hungarian in his forties".

Balducci is part of the Gentlemen of His Holiness, a group that helps the Pope greet dignitaries visiting the Vatican.

He was arrested on February 10 and then removed from his position in the Vatican fraternity.

Ehiem was kicked out of the Vatican choir on Wednesday.

The Catholic Church is currently enmeshed in a scandal over alleged sexual abuse of members of a boy choir formerly headed by Pope Benedict XVI's brother Georg, now 86, in the southern German city of Regensburg.

http://www.montrealgazette.com/life/Vatican+chorister+hired+escorts+papal+attendant+Report/2646352/story.html

The title of this topic caught my eyes and was laughable.
We all know what the banks are going through, rot or not.
For someone to of Sanusi position should know that  the interest rate is not what is discouraging lending.
He himself is discouraging lending.
His policies and actions have trimmed down the banks risk  taking appetite which was nurtured during the consolidation saga.
The massive lay offs in the banks points to the fact that the banks are generally cutting down operations.
They are closing down branches.
Sanusi was even ranting that a certain bank had 60 branches running at a loss.
If you had ever been a player in any industry, you would know that bad news from one company can pull down the whole sector. capitalised or not.
This I expect sanusi to know but it is either he is not aware or that he is negligent of the fact.

You tell the world that 8 out of your 24 banks are insolvent.
That is not a joke, That is a crisis of fundamental nature. !
A foreign investor or a potential creditor will hear this news and be  cautions on Nigerian banks as whole.
They are becoming more pragmatic and are reducing the commitment to investing. (Staff size being an investment for every company )

He should know this, everyone does.
It was always going to come to this right from the day he started his rants.
I don't expect him to admit but someone has to say things the way they are.

I dont see anything wrong in sanitizing the banking sector.
But don't give us the impression that this is just an isolated case of a few errant bank MDs.
He should give us the true picture of things.
It has never been this bad , a third of our banking institutions were distressed !

GOD HELP US !

biina:
How does 'many' become 'all' or that the sham went beyond the penalized banks, and more importantly become all banks being under-capitalized and insolvent? so the question becomes how long?

sanusi allegedly did not sack bank MDs for some sharp practices, he sacked the MDs for the insolvent state of the banks. Period.
People like Ovia engaged in sharp pratices, he too bought a Jet , he too used banking funds to pursue personal interests.
We do not hear of them today because Zenith was still deemed to be adequately capitalised.

You on the other hand seem to feel things are yet to get worse?

Misquoting me again. I dint say things are going to get worse. I only said that things are bad as they are.
The banking sector is presently in one of its worst shape in recent times.

You seem to be equating adequate capitalization of the banks to consolidation. Adequacy of capitalization is dependent on the level of exposure, and while Sanusi said that the CBN was not diligent enough in its handling of the capitalization, the audit report said that 14 banks were adequately capitalized. The only fair conclusion that can be reached from his statements was that some banks were not genuinely as capitalized as they claimed. The level of severity cannot be ascertained just from those comments.

I am not equating the two but they are not completely exclusive issues.
The larger your capital base, the larger your risk margins.

8 executives were forcefully changed by the CBN, while the deadline for tenure limit change is july 10 and I know of it affecting only 3 banks (zenith, sky and UBA). who is the 12th?

First Bank also experienced a change in management Remember ? (Sanusi) 

Succession of the top executive is not necessarily equal to a management overhaul. Even so, half is far from full, and you cannot make any more case for half-full than for half empty.

So you want to wait until all the banks are on their knees before you acknoledge that things are Bad 

I disagree. While job creation can be used as an indication of growth (real or otherwise) in a company or sector, job losses can simply be a move at improved efficiency and profitability.So how many banks are we talking about?

So all the banks all of a sudded decided to be more profitable and engaged on a mass sacking campaign.
Do you live in the real world

Is FBN, Zenith and others who passed the audit have above normal turnover?
You cannot use a handful of the banks to generalize for the whole sector.

But even the cleared banks are still sacking workers /downsizing and restructuring.
This may be due to either tighter or new operating conditions or other challenges which I had mentioned earlier.
Closure of available credit lines and lower confidence in Nigerian banks.(Due in part to the lower credit rating of Nigerian banks)
Imposed or new management.
Drop in revenue etc

I agree that I dont, but the indices and history point towards it not continuing beyond that. Once the AMC  (which is supposed to be operational by then ) absorbs the bad debts, I dont see what else could pull the banks further down.

what indices or history. Do you think you are talking to a kinder.

S&P downgraded Nigeria's outlook rating from stable to negative in March 2009 (before sanusi's appointment)

But you said they are improving .
Moreover Fistbank was exclusively downgraded Aug 2009 by S&P even though it was well managed by Sanusi.
There has been no upgrades by S&P so far.

So I dont see how it was a fallout of Sanusi's actions. Nobody is saying there has been no impact, but you would like us to believe that things are worse than the CBN says they are. Yet you have not provided any evidence to this effect.

During the consolidation saga, a lot of banks were put under difficult targets.
As at the time we did not experience the mass sack going on now neither did we experiance this level of downsizing.
Then came the recession and stock market crash there was still no mass sack and downsizing.
Then came the reforms and all banks including FBN and Zenith were sacking workers en masse.
You do the math.

biina:
@Roadstar
So all you are saying is simply speculations. You have no facts and yet you demand that Sanusi comes clean?

I am using sanusis facts where he says that the consolidation in general was a sham and that banks built their capital base on depositor funds.
The thing is points u sometimes use to boost ur position can sometimes be used against you.

You are convinced that Sanusi is not doing a good job, yet you have no evidence to the contrary.

I never said so. You are just bent on defending Sanusi even when theres no need to.
Im just saying that whether good or bad his actions have caused rippled in the banking sector and will take time 2 settle.

24 banks were audited and 14  were found to be adequately capitalized and liquid, and 10 were found to be under-capitalized (marginal or otherwise). But you now claim that all are under-capitalized and that Sanusi said so?

Sanusi taking a blanket swipe at the consolidation excersise as b eing a sham is indirectly saing that the exercise this not lead to well capitalised banks.

Without any evidence, you claim that the 'rot' was widespread.

Sanusi implied so.

The level of management changes varied from bank to bank, yet in total, the CBN induced CEO changes (including tenure limit) occurred in about 10 banks, most of which were distressed and yet you want to categorize the entire sector as being under management change.

You have a way of trying to misquote me.
A specifically pointed out that 12 which is half of the banks are under management change.
Anything that affects half of the sector can be said to affect the sector as a whole.

The distressed bank hiring is a sign of growth and not stability or is downsizing not a tool for improving profitability, or you think it only applies to reducing losses?. Hasn't the number of people sacked been reducing each week? You have no evidence to suggest that the downsizing will continue beyond September.

Just like in Macro-economics. Job rise figure show that an economy is improving.
Job losses show the reverse.
Banks that are still firing workers are at the least not yet stabilised yet.
You also dont have any evidence that it will not continue beyond september

The fitch report of february 2010 says the sector is improving. when was the last fitch rating report you received?

The same fitch that was hired by CBN to rate the banks
As a fall out of Sanusis action,s Nigeria had a downgrade by S&P and hasn't improved it since then.
Dont confuse things here.

I am not hear to talk of the long term outlook but sanusi should admit that there has been an impact on the banks of his reforms.
Instead of giving this impression that all has been contained and business van go on as usual.
His inexperience did not enable him heed to the warning and now he is trying to mask the effects.

biina:
I suggest you read the audit reports.
and you think things will get worse? The banks have been audited, and those with shortcomings given directives to rectify their positions.

You seem to have a story book interpretation of the crisis.
The dismissed CEOs were not the only errant ones.
The rot was widespread. Those dismissed were dismissed as a result of their degree of insolvency which exceeded a certain threshold.
All banks faced various levels of insolvency.

You make reference to ongoing activities as if they will continue indefinitely.

Not at all! But the fact is that the negative impact like I listed is still being felt.
banks are still closing down branches and sacking workers as we speak.

Will the banks keep sacking forever?

No, But they are still sacking and are nowhere near conditions of hiring workers (which will indicate some form of stability)

Have healthy banks not been receiving new credit lines?

No asides the CBN publisized one.

Has foreign ratings not improved?

The last rating I got from Fitch Dowwngraded Nigerias banking sector.
The fact that it commended the CBN does not translate to an upgrade or improvement in foreign ratings.
So I dont know what u are talkin about 

Is the change of management not restricted to the distressed ones?

No if you add the retired ones like Elumelu, Ovia and co
We are talking about half of the banks.

Is being asked to raise your capital base now a sign of distress?

When inluded as part of an audit report it is a sign of limited distress. It means you are not properly capitalised.
The world is not black or white.
Between distressed and non-distressed you have various levels of distress

So in your opinion all the banks are under capitalized and cannot lend?
and where is your evidence that it is not? 

I dint say so. sanusi said so.
Sanusi's actions and comments, including the one at bayero where he alledged that banks had used depositor funds to capitalise points to the fact.

When you know the problem and can implement the solution, it is really that easy.

Sorry mate, Sanusi Mistake. Its never really that easy .
I guess he was thinking like you as he underestimated the impact of his actions.

Your are simply crying wolf, when there is none.

Whatever that means

Which speech are you referring to? If its the Bayero address, it seems you havent read it  first hand and are only commenting on second hand info.
Have the banks not been audited, or do you expect new revelations that were missed in the audit?
Have the banks not provisioned for their bad debts? Is the AMC not being established? The problems in the sector have been identified and are being addressed.
A few months ago some of you were claiming there was nothing wrong with the banks, and now you are singing a different tune that the problem is everlasting

You clearly have little knowledge of the financial world.
You do not appreciate the impact of uncertainties, heavy handed legislation and crisis impacts business confidence which impacts the markets which impacts the economy.

The CBN identified the problems (and this was common knowledge even before soludo took over) and took the necessary actions. Do you want him to start chasing ghosts?

I haven't really asked him to do anything , like you said, he has done everything he has to do (although I doubt it)
I am only saying that he should stop this culture of deceit . By saying anything to protect his position.
He need to come clean on the true situation of the banking industry.

Get your self properly informed before making allegations.

I did not make any allegations, I am just making speculations based on judgement and experiance. The same way I made in these admonishions in august last year.

@biina
You seem to be overzealous in your job of trying to justify Sanusis actions.

That is not what I am interested in at the moment.
I am just trying to asses the present situation with the banks and and how it affecets economy.

In you own judgement a banking sector which had a credit line facility from CBN shut down (Justifiable or not).
Numerous previously established international credit lines closed. Many investors have pullled out.
Alleinated many of the major players in the sector.(Mind you every banking sector has them)
Many have had their management dismissed and replaced with new and external management.

The general values of these banks have plummeted due to the crash in their share values.
Trying to recover loans, adjusting to the new operating conditions under Sanusis CBN.
Many are still downsizing.
As I am typing out right now a lot of these banks are still sacking workers.
basically, all the banks are still undergoing some form of restructuring, many have been asked by even sanusi himself to raise their capital base. (Asides the 8 bailed out banks)

And in your own opinion, interest rates have an equal effect with all the above.
Well I beg to differ .

You even dismissed the situation by saying that "The worst is over, and the troubled banks should be weaned by September."(In Sanusis words of course) Do you think the crisis affected just the 8 banks bailed out ?
Do you really think its gonna be that easy 

If Sanusi was quick in exposing the rot and the inadequacies of the banking sector and is still doing it till at least last week with another speach.
It will be deceitful and of very poor judgement if he is now trying to play down or hide the effects.
By pretending that the banks are in a normal state as if the whole thing is just about some errant CEOs.

If this is how Sanusi sees the whole crisis, then this is a huge miscalculation on his part.
He might have just presided over the biggest government induced crisis in Nigerias banking history.

biina:
because they are different things. In the prior case, the CBN disbursed money from the excess crude oil account to stop the illiquidity in the economy from grinding governemnt to a halt by giving them money (that is theirs) to spend on their obligation, where in the current case the CBN is reducing its deposit interest rates so to discourage the banks from keeping money with the CBN and encourage them to lend t both governemnt and the private sector. CBN is not giving anyone money.
Sanusi fired the corrupt executives, input neede capital to shore up the banks, appointed interim management to oversee the banks (that are now essentially running on tax payers money) and tried to help the banks recover some of the bad debts by publicly pursuing the debtors (a move that made a significant number of those debtors reconcile their accounts)

It was the sacked executives and some misguided Nigerians that were spreading doom and gloom, and claiming an hidden agenda (that is yet to materialize) that caused most of the downtown. The stock market decline had begun before Sanusi took office, but some people would rather blame him for it.

To cut the long story short.

In your own opinion
Which is the biggest culprit to why you think banks are not lending ?
Is it the impact of the crisis or is it the interest rates.

If the 2billion government stimulation did not bear much fruit.
Do you think the banks in their present state can make a difference.

In my opinion
I think that sanusis actions (wheter in good fate or not) has negatively impacted the banking sector.
I also think it will take years to come outta this mess and and reap the fruits of sanusis actions (If it bears any fruits).

On a more serious note the government should look at alternative options to stimulate the economy asides  these banks.
Because for now the banks are in a perpetual crisis, more complex than just adjusting interest rates.

biina:
The same impact you get when the different levels of govt get their monthly allocations i.e. they have funds to meet their obligations. The government simply paid themselves a 13th month salary. To evaluate how well they met their obligations or how much it affected their local economy, you would have to assess it on a state by state basis. The funds were not meant for the private sector nor were they fuel subsidies.

So why should this one be different ?
Sanusi of all people should know that the present inability of banks to lend to the wider economy is not due to unfriendly/tight fiscal policies.
it is due to the huge dent to confidence experienced in the banking sector as a result of the banking crisis.
He is being deceptive by tweaking around interest rates.

I still feel Sanusi should have toned town all that razmataz that had to do with the banking crisis.
He should have focused on fixing the problem without exacerbating it to that extent he did.

Many countries try and implement various policy models which work to an extend or fail with lessons learnt.

The former CBN administration had looked to finance SMEs which make a huge chunk of the Economy through governments support of banks and MFBs.

These banks were supposed to have been supported until and extent where they could become a major alternative to government spending.

When sanusi took over office, he acknowledged that for the first time in Nigerias history, banks had narrowly overtaken government spending as a source of public financing.

Now all that is history.

Now the model has been scrapped by excessive government interventions with some the banks accused of over lending or careless lending.

I predicted that banks will slip to a comatose stage after all the dust has settled and alas that is happening right now.

What is the impact of the $2bn late last year by FG.
Was there any impact assessment.
Now CBN is about to spend more.

CBN should try and stem the mass sack in the banking sector before trying to induce jobs in other sectors

Maybe re-open the EDW(Soludos approach) but with another name (Sanusi approach)

Well while Sanusis actions might make sense im rather uncomfortable with the complete exposure of our banks to foreign investors.
Kenyas economy is 80% foreign, even south Africa.
These economies are stagnant compared to china and India which had been protectionist for decades and are now reaping the fruits.
Even the asian tigers learnt a bitter lesson during the 90's with this kind of practice.
Opening the Nations financial institution without limits is dangerous.

But that is only my opinion though.

Well while Sanusis actions might make sense im rather uncomfortable with the complete exposure of our banks to foreign investors.
Kenyas economy is 80% foreign, even south Africa.
These economies are stagnant compared to china and India which had been protectionist for decades and are now reaping the fruits.
Even the asian tigers learnt a bitter lesson during the 90's with this kind of practice.
Opening the Nations financial institution without limits is dangerous.

But that is only my opinion though.

Soludo acknowledged that there were problems in the Banking Sector.
Created the EDW to assist the banks with credit.
Just like US created Tarp and co.

In order for the true positions of these banks to be ascertained he had just insisted on a common year end for all banks.
This was due before he left CBN.

He presided over the further merging of Banks e.g Bank PHB and Spring bank which got aborted.
He was also trying to do same for Wema bank and Fin Bank.
Just like the US government managed BoA and Merrill Lynch, Bear sterns and JP Morgan.

He had aknowledged that there was another set of consolidation on the cards but that the problems did not present any underlying problems to the wider economy.
This was until sanusi came a caused a quake.


Tell which Central Bank or reserve bank governor blew the whistle on the dire state on banks within their boundaries.
Mervyn king confesed a few months back how he had supplied RBS and Lloyds TSB with secure govenment funds of up to £60 bn.
This was not even leaked to the press untill more than a year after.

This dude in all his actions seems to be treating the banking sector with a lot contempt.
And wants to kill or at least leave them in a comatose state.

My main argument to this is that how can a Sanusi who let[b] Unity Bank of the hook[/b] because they had high deposits. (Mostly by nothern state govenments) even though he admitted that they were not well capitalised with overbearing non-performing debts, turn around to say that Soludo had allowed some banks to shore up their capital base using depositor funds.

What is he smoking  
Or does he think we are all fools  

biina:
and some people lack basic reading comprehension skills. 
Stating that a non-communist country does not need a state owned media station, is not the same, nor does it imply, that all countries with state owned media are communist states.
English comprehension is not as hard as you make it seem 

So why do you think that a non-communist state does not need state owned media.
How did you arrive at that conclusion.

If all the non-coummunist nations overwhelmingly have state owned media stations ( right now I cannot even think of a major nation that doesn't , communist or non-communist) how did you make the assumption that it is not needed.

If you had mentioned that the satement was in your own opinion then no qualms.
But you stated as if it is common knowledge that only communist nations need them.

It is the mis-information that people like you spread that I am trying to address.
Stop trying to twist your way out of an erroneous assumption, citing english language

Ibime:
Sanusi needs to protect CBN at all times. . . .that means he should refrain from criticising Soludo, and cover him up if necessary. . . .CBN should be seen as a credible institution, not a institution prone to corruption and laissez faire regulation.


That said, it is not surprising that after consolidation in 2006, it only took 2 years for the banking bubble to burst. . . . this speaks of poor regulation. . . however, Sanusi will be well advised to protect Soludos legacy at all times.

I agree that he should stop the mudslinging but cover up Soludo, I dont agree.
He should point out the lapses in the previous activities of the CBN.
But on these allegations are weak and ill- motivated.

This blueprint for the banking industry has been trashed as incoherent and ambiguous
.
And then he picks a fight with his predecessor.

Is he trying to discredit the the consolidation exersice as unnecesary or is he agreeing for the need for consolidation but pointing out that it was not properly done ?

The Consolidation was not a target but a means to achive a taget of a stronger banking industry.

We all know that a lot of banks used the option of using depositors funds to raise capital still weren't able to.

It was never a hidden fact that capital was raised using depositor funds as one of the sources and Soludo will not deny knowledge.
It was widespread. During the consolidation saga it was eveident as all banks were competing for depositors.

Even the same Soludo came public with the fact that he wanted to extend a 30bn cash loan to Bank of the North.
Even that was even more unethical/inappriopriate than using depositor funds, he only withdrew it because of the unmarketabily of a bank with such huge debts.

Soludo will tell you that the consolidation exersise was done to converge the banking industry to a fewer number of Banks which will give them an improved potential for growth.

That doesn't necessarily mean that banks need 25bn to operate.

And can the same Sanusi Justify why he let Unity bank of the hook during his last audit exercise citing a high level of depositor funds, even when their capital base had been eroded like all the other penalised banks 

Isn't this a case of kettle calling pot black ?

Mr Sanusi, you are now in charge, Just fix it !
I cannot help feel that this man has not been able to shake off the shadow of Soludo.
This I believe is due to the fact that people still look back to the days of Soludo with a lot of Nostalgia.

If he is doing a good Job we should start to realise the fruits in years to come.
I hope he is not conceding to the fact that this cannot be achieved.

nex:
Dora is an uncommon criminal. So where are the OB Vans now? Or if not, where is the N8.5 billion?


Even before Dora was made Minister of Information, I'd already known she was crook. Have you people ever wondered what happened to Nestlé after they were caught killing Nigerian babies with expired skimmed milk? Or you all have forgotten. Nestlé settled the NAFDAC boss and the case was dropped.

I hope you are not sourcing your info from SR ?
Give me a credible source about the above.
This how Aandoka came up with allegations and started begging when faced with a court suit.
Print your claims and show your face and defend it in court if your very sure of the above.
You know by now say Dora no dey waste time.

Now look at her in the FEC, she's kept mum all this while when Yar'Adua was away. Imagine a Minister of Information who could not inform the Nation on issues regarding the life or death of the President. All of a sudden, she gets wind of the plan to implant Jonathan as president, then we hear her voice finally condemning the emptiness of the president seat.

Na who be the mugu? Na who be the Maga?

And that is supposed to be her fault.
Even the Vice-President Acting President cannot inform you on the condition of Yar'adua till now.
Neither can you nor SR.
Tell me what you expect her to do, spread unsubstianted claims ?

biina:
NTA should have dismantled and sold a long time ago. We are not in a communist state, and don't need government owned media stations.

I guess the UK with BBC is a communist state
And VoA is not goverment owned.
What of SABC.
Some of you just come here and type away just for the sake of it

FYI
MrCrackles and co can you have a look at a more complete version of the article ?

http://www.sunnewsonline.com/webpages/features/newsonthehour/2010/feb/28/newsbreak-28-02-2010-001.htm

At least you will appreciate what it means 2 be an uninformed Information minister.
Just like you just got misinformed by the cooked up version you just read 

There have been many events in the past since the civil war where things went wrong and no one spoke out !
Preferring to be tactful and diplomatic only to come out and start granting interviews and writing books (e.g Obj, David West, Sanusi) when all the water has gone under the bridge.
Great Nations are made of Great people. People like Dora, Wole Soyinka , Gani, Chinua Achebe and co
who will expose all illegalities and put it in the court of public opinion.
And not people who still exhibit all this our cultural tendency to be conniving and hiding evil !

MrCrackles:
Shut the fu/ck up you bloody nob head. . . .
Who is not acknowledging the courage Dora has shown?
What i am saying is that she needs to be careful and tactful on how she sends out the message
Of course we need people who can stand up tall, and Dora happens to be one of them so why would i have any issues with that. . .
You are too daft to understand the message i was sending across and it is not surprising, it is because you are a buffoon!
Bellend

While I agree with you that she has to be tactiful and calcukated in her comments.
But these apply to civilised situations.

How will you feel if as minister of Info you dont have access to info.
Then when she goes out and tells tactiful info(Lies), people will call for her head.
Even people like who I know have done it many times in the past.

Now she is stating her ming you calling for her head.
Do you know how shameful it is 4 ur president to be smuggled in at night without anyones knowledge.
Do you know how foolish Ojo Maduekwe looked when he appeared on BBc to say that he had neither seen nor heard from the president 4 months.
But was trying to inform the world on the presidents true situation.
Do you know how many jokes are being cracked about Nigeria all over the world because of this Yaradua debacle ?

My friend this not the time to call on anyone to be tactiful or diplomatic in comments
Because all hell has broken loose.

I said it  
It was only a matter of time before she explodes.
Those that made her minister of info din't know what they were toying with.
She is not a political material. She  is just one who will voice her opinion the way she sees it.
Doesn't care if feathers are ruffled.

It is just like making Wole Soyinka, or Gani (RIP) a minister.
Do you expect these individuals to be tactical in their comments ?
I know many who have criticized Wole for not being tactical and attention seeking but the truth is that that is Wole for you.
The same he will tell you is what he will tell the FG, US government and will not give a damn.

In my own opinion we need more of these in our political arena.