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Plot to takeover five top banks in Nigeria

by Business News Report

(This story was written by Ilimemomoh Peter Gabriel whose pen name is Omoh Gabriel, the Group Business Editor of Vanguard, Newspapers Lagos, Nigeria.)
The story was generated from the controversy that shrouded the appointment of a new Central Bank Governor when the first term of the then incumbent governor was coming to an end. It was how a group of Nigerians, businessmen, former bank owners and top employee of banks in Nigeria with high political connection, who felt left out during the banking consolidation teamed up to regain their influence, positions in the banking industry and take over some banks in the long run. It took quite a while talking to members of the National Assembly, the presidency, office of the Secretary to the Federal Government, bankers and CBN officials to be able to piece together the information that made up the story. The hidden agenda behind the move made it one of the most difficult stories to put together. It was about a month of seeking relevant information that I finally got the lead that Anti consolidation forces have regrouped with the hope of dissembling the banks and forcing a take over of the top five banks in the country. The grand plan by the group is to cause panic and uncertainty in the industry and make the target banks look unsafe for depositors. Their aim, as the story was told is to cause loss of public confidence in the banking industry and compel the Federal Government to move in by injecting funds. Further, they ultimately plan to instigate government to take equity holdings in the targeted banks. Most of the government functionaries who knew what was going on did not want the story published. They tried every means to discourage the publication of the story. The group at work both in the public and private sector were people with means that can afford to stop any story. For a month we left the story in abeyance as if we had reached a dead end but when it appeared that the story was forgotten we went ahead and published it on March 23rd 2009.
In June 2009, Sanusi Lamido Sanusi was appointed CBN, Governor. On August 14, five months after the story was first published, he sacked five banks Managing Directors and injected N420 billion bail out funds into the banks. Then the story gained currency and came to life. It was circulated through the internet to every Nigerian within and outside the country. It became a subject of editorial, republished in magazines, Newspapers radio, Televisions and columnist commentary. Lawyers used cuttings of the article to file court action against the apex bank. My investigations had revealed that the group at work is made up of former bank owners who lost out during the consolidation exercise, a powerful clique in the present government, and some aggrieved persons in three of the six geopolitical zones in the country who felt left out in the consolidation exercise.
The group second game plan is to make Nigerian banks look unsafe in the eye of the banking public. They have perfected their game by spreading rumour that some categories of banks are unsound and are on the verge of collapse. They send out text messages to individuals and account holders passing wrong information on their target banks. At the moment the group’ target is one of the high flying new generation bank where they have sent out several messages. One of the text messages which one of the operators gave to Vanguard stated “___, one of Nigeria’s high-flying banks is facing serious difficulties that could force it into liquidation before the end of 2009. The bank’s precarious situation is due to its huge exposure to toxic loans to stockbrokers and importers of petroleum products.
“While CBN has offered a stout defence of the bank’s financial position, a detailed investigation has confirmed that the bank’s net assets are dwindling by the hour. The Federal Inland Revenue Service recently stopped the bank from collecting revenue and the EFCC has invited some of the bank’s top brass over the N19 billion facilities given to the CEO of an oil marketing company. The bank recently tried to raise some money by increasing its minimum savings balance from N1, 000 to N10, 000 hoping to use the cash to bolster its books. The move backfired as the general public could not understand the rationale behind the directive.

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