Tuesday, November 10, 2009

The governor of the Central Bank of Nigeria has told Gambian bankers and the Gambia government that Africans must endeavour to strengthen multilateral relations in order to eliminate the scourge of corruption.

He also observed that Africans must take new banking reforms to stop the criminal practices of some banks from putting their depositors and creditors into dangers. Governor Lamido Sanusi was speaking last Thursday at the Sheraton Gambia Resort and Spa, where he had a day?s sensitisation of Gambian bankers and stakeholders on the recent banking reforms in Nigeria as apart of his official visit to some sub-Saharan African countries.

The new banking reforms in Nigeria sparked a wave of panic in the country?s banking system, showing a collateral shake-up in the country?s financial sector, leading to the sacking of eight major bank managers after an Economic Financial Crimes Commission (EFCC) was established to look into the country?s banking abnormalities. In September, Sanusi announced unequivocally that he has no regrets over his controversial shake-ups and reform of the country?s banking system, saying his intention was ?to safe the banks? and in doing so, decisive actions had been needed.

In last Thursday?s meeting, he told Gambian bankers and stakeholders that he is  still committed to see that Nigeria?s bank managers who are suspected of banking malpractices are prosecuted and if found guilty, the wrath of the law be applied on them.According to Sanusi, a combination of collapse in Nigeria?s economy puts the government finance in a massive depreciation on the Naira to 25% to the dollar. Before the global financial crises, he said Nigeria?s stock exchange was the best. Once the global financial crises started, he added, FTI?s commenced and a classic case of asset deflation started, which caused liquidity to take over completely from the market. ?Because of the importance of banking to Nigeria?s economy we could not allow ourselves to take any risk,? Sanusi told the gathering.

Sanusi explained that when he became Nigeria?s CB governor in June, he found that there were major sources of the liquidity problem. ?It is a lesson on why we would introduce a banking reform while we can all talk about the strength of our banks,? he said, and added: ?when I came first, we set up a general bank check-up assessment to make sure depositors and creditors are not at risk?. 

The Nigerian CB governor further told the gathering that managers of banks that were suspected of malpractices were held responsible during the check-up which led them to the bringing down of the management of eight banks in the country with no single depositor or creditor losing their money. He said banks were using subsidiaries that are not approved by the central bank; banks used to own investment banks and this, he said led to the crash in the Nigerian economy. ?In the next few weeks, we will be working with the National Assembly to put everything in place and in two to three weeks everything will be at the back,? Sanusi vowed.

Governor Sanusi then cleared the air, telling Gambian bankers and stakeholders that Nigeria?s central bank did no encourage any of their banks to come and exploit them. He reminded bankers that in order to win the trust and confidence of their customers, they must play a catalyst role. ?The heads of all the banks we have removed was based on their exploitation of depositors and creditors. We handed over every document related to criminal acts to the EFCC,? he said. 

Sanusi said it is not a crime to borrow money nor is it a crime to borrow and have bad money; but, he said, it is not equally a crime for one to borrow and his name be published for defaulting to pay back. ?If you want to go to equity, please always have clean heart?. He proudly announced before Gambian bankers that as at now Nigeria has recovered 179 billion Nairas.


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