14 Nigerian banks to enjoy $7bn reserve

On September 7, 2018, the Chairman of the Special Presidential Panel for Recovery of Public Property, Mr. Okoi Obono-Obla, noted in a News Agency of Nigeria report, in Abuja, that the panel was continuing its investigations to “recover monies that have been taken away from the people of Nigeria.” One of such “loot”, according to the panel’s chairman is the “almost $7bn “bailout” that the Central Bank of Nigeria granted 14 commercial banks between 2006 and 2008.

Obono-Obla also confirmed that “after 13 years, these banks have not returned the money to government’s treasury.” Curiously, however, according to him, “when we enquired from the CBN the state of that money, the banks told us that the money was ‘dashed’ to them.”

It is not clear why the presidential panel made its inquiry to the CBN, but instead got a response from the banks. Nevertheless, Obono-Obla reiterated that the $7bn belonged to “Nigerians and so could not be given away, for free, to commercial banks, owned by private individuals.”


Indeed, in exchange for their bloated bad debts, which were often poorly collateralised, over N5tn ($30bn) was additionally eased into the banking sector to bail out distressed banks in 2009. Notably, however, there is still no evidence of any refund whatsoever, of the $7bn, which ex-CBN Governor, Chukwuma Soludo, reportedly “dashed” 14 banks for consolidating the mandatory N25bn capital base in 2006. Ironically, government has since borrowed trillions of naira from, and paid double-digit interest rates to the same banks with whom the CBN placed $7bn “awoof” credit in 2006.

However, the above is the title of an article first published in October 2006, soon after Soludo embarked on a bizarre escapade, which was, arguably, a scam of Nigeria’s treasury. A summary of that article follows hereafter. Please read on.

“The report that 14 Nigerian banks were appointed as ‘asset managers’ of Nigeria’s reserves was published in The Guardian newspaper of October 5, 2006. The CBN spokesperson, Festus Odoko, confirmed in that report that ‘already, $7bn cash deposit representing part of the CBN’s share of foreign reserves, presently estimated at about $38bn, had been released to bankers.


Consequently, the CBN made good its promise to invite Nigerian banks, which succeeded in consolidating a $500m capital base to a ‘foreign reserves banquet’, on the condition that they provided evidence of collaborative agreements with credible international financial houses. However, it is not clear whether or not the required MoU. between the 14 Nigerian banks and their respective international affiliates involves the adoption of global best banking practices and ethical standards, with collateral responsibility for financial integrity and profit, or if such a collaboration is simply a glorified correspondence relationship with credible international banks!

Nonetheless, critics would wonder if the 14 banks which only just succeeded in raising their capital base, with much duress to N25bn, could also raise additional capital of about N35bn so quickly to qualify to manage part of the CBN’s $7bn reserves. Consequently, the CBN may have quietly dropped this additional requirement to pursue its declared agenda of liberally empowering banks with government’s foreign reserves!


But whose interest is the CBN serving with the disbursement of $7bn of public funds with such levity? Although Festus Odoko revealed, in The Guardian report, that the appointment of the 14 banks for ‘reserves management was ratified by the Investment Committee’ on Tuesday, October 3, 2016, the $7bn ‘bounty’, curiously, was confirmed, as already shared before the report was published on Thursday morning, October 5, 2006!

Nigerians may not appreciate that with one stroke of the pen, the CBN committed Nigeria to possibly its largest single investment ever! The question, however, is whether or not the expected return from this ‘huge investment’ will stimulate productivity and employment opportunities, and improve our social welfare. If not, who will benefit from this biggest ever single investment paid upfront by Nigerians with no return? Yes! Expectedly, the 14 banks will, invariably, wear broad smiles to their overseas vaults! Although the CBN has not yet declared what returns are due from the 14 fattened beneficiaries, it is unlikely, however, that it will get more than the prevailing international rate of about three per cent interest per annum for such placements!

Incidentally, the 14 favoured banks are free to invest anywhere in the world! Thus, while Nigeria’s government goes cap in hand for foreign loans to support economic development, the CBN has simultaneously, also, ironically exposed our hard earned $7bn forex, possibly, for ‘free’, to a consortium of Nigerian banks which presently have a consolidated capital base of less than $3bn, without asking for some measure of audit control or equity participation.

Notably, Nigerian banks still do not find it attractive to lend to the income and employment-generating SMEs; therefore, a $7bn largesse may not change the attitude of banks to the real sector. The bizarre strategy of harvesting minimal or zero returns on a $7bn sovereign loan, without tenor, is starkly amplified by the CBN’s willingness to, conversely, simultaneously pay interest rates between 12 and 17 per cent for the funds it continues to compulsively borrow from the same banks!

Furthermore, if the 14 banks are free to repatriate all or part of their $7bn ‘gift’ back to the Nigerian capital market, the obvious domestic investment destination would be further patronage of government’s Treasury bills and bonds where they would earn up to 17 per cent return. Unfortunately, nonetheless, the trillions of naira the CBN borrows with Treasury bill sales are regrettably not tied to any specific infrastructural project, but are inexplicably, simply sterilised in the CBN vaults to restrain consumer demand and higher inflation.

The CBN spokesperson also confirmed in The Guardian report under reference, that ‘the $7bn represents the CBN’s share of foreign reserves!’ The question, however, is what work did the CBN do to earn and freely give away $7bn? Furthermore, the constitution clearly does not allocate any portion of dollar reserves to the CBN. Invariably, crude oil earnings clearly belong to the Nigerian people, as defined by the three tiers of government. Thus, the National Assembly would have defaulted in their constitutional role if the CBN is not invited to defend why $7bn of Nigeria’s reserves should be ‘given’ to 14 banks without any return or oversight approval by the National Assembly!

The above article was first published in full in October 2006 and republished in 2010, 2015 and 2016, with the title “Where is $7bn CBN placed with 14 banks? Not surprisingly, however, by 2009, three years after Soludo’s ‘celebrated’ banking consolidation, most Nigerian banks tittered on the verge of collapse. The 14 favoured banks, apparently, have never repaid the $7bn which may have advanced before the banking crisis. Consequently, Nigeria’s $7bn may ultimately have gone with the wind during the ensuing financial meltdown in 2009! Nonetheless, such probable default still did not stop banks from receiving an additional mind-blowing largesse above N5tn ($30bn) from lifelines extended through the CBN and AMCON interventions to prevent ban failure between 2009 and 2010!

Notwithstanding, the CBN’s misguided Father Christmas generosity, banks have clearly failed to service the real sector with cheap, loanable funds, which would stimulate industrial rejuvenation, economic growth and increasing job opportunities.

Consequently, the EFCC should closely examine the circumstances regarding the sharing and the ultimate fate of the CBN’s extraordinary package of $7bn to banks in 2006. Nigerians surely have a right to know: ‘After all, if the $7bn largesse to banks was a widely reported media affair in 2006, its refund or successful liquidation should also have been heralded by an ‘in-your-face’ media blitz.

POSTSCRIPT: SEPTEMBER 2018: Curiously, despite Obono-Obla’s recent bombshell in September 2018, press/media/public reactions against this brazen pen robbery have been, unexpectedly, rather lukewarm. Incidentally, however, acting on a request, about three years ago, learned silk, Femi Falana and Associates, approached the CBN on the platform of the Freedom of Information Act, for a confirmation of whether or not the 14 banks ultimately liquidated the CBN’s untenured credit of $7bn to privately owned banks. Regrettably, however, the CBN has till this day, ignored the FoI request, until Obono-Obla’s recent revelation.















Rainbowgist

FRSC recruitment: Screening, physical assessments to commence Sept 24

The Federal Road Safety Commission has scheduled its screening and physical fitness assessment on recruitment for Sept. 24 to 29.

The FRSC Public Education Officer, Mr Bisi Kazeem, said in a statement on Friday that the screening would be conducted in all the state capitals.

Kazeem advised applicants to check the email used for submission of the applications on Sept. 19 for information on the exercise.

“The information in the email will contain the venue, date, time of screening and required items to be taken along for the exercise,” he said.

According to him, shortlisted applicants are to come with the summary data page earlier received and the email notification slip which shall admit them to the screening venue.

The FRSC image maker said that any candidate without the printout of the summary data page and notification slip for the phase of the exercise would not be admitted into the venue.


The FRSC recruitment started on May 28, with the uploading of the application forms on the FRSC recruitment portal.


















Rainbowgist

Nigerian ambassador to Qatar, Abdullahi Wase dies

The Ambassador of Nigeria in Doha, Qatar, Amb. Abdullahi Wase is dead.

A statement in Abuja earlier today by the spokesman, Ministry of Foreign Affairs, Tope Elias-Fatile, said Wase, a non-career ambassador from Plateau State, had been sick for a while until his death on Friday night.

The late envoy would be buried in Doha at 7.00pm (local time) today.

“The Minister of Foreign Affairs, Geoffrey Onyeama, received the news of his death with shock and prayed that God grant his family and the nation the fortitude to bear the great loss,” the statement added.















Rainbowgist

Osun: What Nigerians are saying about the alleged freezing of Adeleke, Davido’s accounts by EFCC

Reactions have trailed the alleged freezing of the bank accounts of the Osun State Peoples Democratic Party governorship candidate, Senator Ademola Adeleke, and those of his family members, including singer, Davido by the Economic and Financial Crimes Commission.

The PDP has already condemned the action of the anti-graft agency, and called on President Muhammadu Buhari to direct the EFCC to unfreeze the accounts.

Meanwhile, Nigerians have been reacting to the alleged freezing.


See some reactions:

Dawodu Olatokunbo: “Much ado about nothing. I do not like ur style Mr Publicity Secretary since you took over office. You most times overheat the political space over trifles. You need to arm yourself with facts if you want us to take you seriously.”

Holy Wahala: “In addition, the PDP also directed its members, including state governors, officials at zonal and state chapters, national and states assembly members, all presidential and governorship aspirants as well as other stakeholders, particularly, in the South-West zone, to immediately commence movement into Osun State with their political machinery to campaign and support the PDP candidate…..

PDP didn’t allow this during their time in power, they didn’t allow Ameachi and other APC party members into Ekiti and Osun to campaign. But see this man today directing all PDP party members to go to Osun state to campaign. PMB is the best.”


That’s pure liars from PDP. Does Davido got political values? or davido father got political values? PDP desperate to win Osun 2018 governorship election, this pre- excuses for losing Osun election, PDP knew they will lose this Osun election they start file unrealistic complaint

— Lekan (@tirimisiyu2013) September 15, 2018
U mean his campaign account right….??
Or better still, one of his accounts,
Coz we all knw dat no politician has a single acct not to talk of a @OfficialPDPNig candidate @IsiakaAdeleke1,
We are tired of dis People Deceiving People abeg.
U hv money nd nt helpful 2 eny1#Japa

— Mr. Prestige (@IamPrestigeCEO) September 15, 2018
I refuse to believe that anyone, in the name of politics, would freeze the bank accounts of a hardworking family THE ADELEKEs including that of this young icon DAVIDO who has done our country very proud… God save our dear beloved nation… I pray it is fake news… pic.twitter.com/NiXs7t5ZT5


— Dele Momodu Ovation (@DeleMomodu) September 15, 2018
They have tried to link him with one clown caught by the @PoliceNG ,who joined a secret cult because he wants to meet davido. then I know they will come for him. This time social media will bring @MBuhari down.

— eL Jumick, GCFR💯🇳🇬 (@eljumick) September 14, 2018
So the EFCC can just wake up and decide to freeze people’s accounts for no concrete reasons all in the name of politics? If this report is true, then all of you that voted for Muhammadu Buhari owe Goodluck Jonathan an apology. KARMA AWAITS MAGU @officialEFCC

— Wilson Shadrach 🇳🇬 (@iam_wilsons) September 14, 2018
Everyday, apc must commit evil why? Buhari sent 16bn to Aregbesola on poll to rig election efcc didn’t freeze osun acct but Magu was fast to freeze Adeleke acct, David acct and his father too… Buhari agenda is jihadist islamise Nigeria!

— John Grace (@JohnGra60799908) September 14, 2018
Lolz 😂 is this message for me ? If yes then you’re sick, I don’t think you know who you talking too , EFCC will freeze Davido account and that’s how you’ll hear it 😂😂😂 that’s why they spoil this Government and lied to you and you believe it, that Buhari is your problem 😂


— M K O (@moshoo1) September 15, 2018
On what ground is their accounts frozen? Who did, EFCC or who? I beg, let them come out clear with full info. Is that why Sen. Adeleke didn’t show up at BBC Governorship Debate?

— transform_100% (@sola_onifade) September 15, 2018

















Rainbowgist

Kemi Adeosun resigns

Minister of Finance, Kemi Adeosun, has reportedly resigned from the administration of President Muhammadu Buhari.

Details later…




Rainbowgist

What you can’t achieve with online banking

Online banks changed the way we bank—for the better—and some people now live entirely without a brick-and-mortar bank account. Online customers can earn more money, pay less in fees, and enjoy the convenience of banking from their computer or mobile device.

However, you might not want to ditch your bank branch just yet. Although, they may seem old-fashioned, branches offer several valuable services that you only miss when you can’t have them.

Does that mean you should close your internet-only accounts? No way. If you don’t have an online savings account, you are missing out.

Here are six perks of using a bank or credit union that offers physical locations.
Instant cashier’s cheques and money orders

Do you need to make a purchase, but a card (or personal cheque) just won’t do? For some transactions, like home purchases and certain types of deposits, you need “cleared” funds. That usually means you need to bring a cashier’s cheque, wire money to an account, or provide a money order to whoever you are paying.


Online banks can provide cashier’s cheques, but you don’t get same-day service. Instead, you typically order the cheque online and then wait a few days for the cheque to arrive by mail (or pay a modest fee for overnight service).

Sometimes that is not feasible. You might not even know exactly how much the cheque should be for until a day or two before you need it. It is nice to have the flexibility to change things without tying up your funds. Ordering multiple cashier’s cheques and trying to cancel an unused cashier’s cheque via mail requires an excess of cash on hand.

If you are on the hunt for that perfect apartment or making last-minute negotiations on a home purchase, instant access is a must.

Unlimited cash withdrawals

It is probably a rare occasion when you need a significant amount of cash. But when you do, it is nice to have the option to withdraw what you need. For example, you may need cash to buy a used car on short notice.


Getting a significant amount from an ATM is difficult. There are ways to withdraw substantial amounts of cash from online bank accounts, but you may need to visit a bank or credit union that is willing to work with you.

With an account at a brick-and-mortar bank or credit union, getting cash is as easy as filling out a withdrawal slip at the branch. As a bonus, you can also get cash back into your account quickly and easily. Cash is unsafe and it creates temptation, so there is little reason to keep it around any longer than necessary.

Safe deposit boxes

Do you have some valuables and no good place to keep them? Are you concerned about what would happen to your files if your house catches fire?

A safe deposit box is a great place to store important documents and small valuables. Instead of reinventing the wheel and creating an ultra-secure (fireproof, theft-resistant, water-resistant) location in your house, let the experts handle it. Banks store your items at a very low cost, and you just need to get to the branch during banking hours to retrieve your belongings.


You need to keep important documents which you rarely need to do anything with safe. These documents could be birth certificates, social security cards, copies or originals of certain agreements, and other documents. If they are just an accident waiting to happen, why not put them in a facility that can do a good job of keeping them safe?

A drawback of safe deposit boxes is that you might need something when the bank branch is closed. To avoid problems, don’t store anything that you might need on short notice, such as passports and medical care directives.

Notary services

Some agreements need to be notarised. That means a Notary Public needs to verify your identity and watch you sign the document. The notary certifies that it was really you who signed the document and that you did so willingly (among other things).

By definition, an online bank can’t really offer this in-person service. But many banks can—often for free (at least one or two signatures might be free) but you will pay a fee if you have got a pile of papers).

As with many services at brick-and-mortar branches, getting a document notarised is not something you need every day. But it is extremely important on those occasions when you do need it. Alternatively, you can use a local (or mobile) Notary Public to handle any one-off signatures.

A place for your coins

What are you supposed to do with all of those coins that end up in your coin jar? Those coins are money, so it is worth putting them into a form that is easy to use—whether you spend the money or use it for savings.

Shipping coins to an online-only bank is not feasible (and it is probably not even allowed). You could pay to have it counted at a machine in the grocery store, but plenty of banks still accept coin deposits without taking a chunk of your savings. They might even let you bring in a mixed jar of coins and do all of the sorting and counting for you.

Face to face meetings

We live in a virtual world, and tasks are getting easier and easier to accomplish online. Traveling to handle a simple transaction in-person is tedious, and can even be a major inconvenience.

That said, there are times when it is nice to sit down with somebody face to face. Communication over the phone or Internet is not always clear, and sometimes it feels better (and might even be faster) to talk and look at things together. Typing out questions and answers has its place, but it is not always the best solution.

















Rainbowgist

EFCC raids Standard Chartered Bank

The Economic and Financial Crimes Commission today raided the headquarters of the Standard Chartered Bank in Lagos.

It was reported that about 20 operatives of the anti-graft agency were seen on the bank premises. The reason for the raid on the bank was not disclosed.

However, EFCC spokesman, Wilson Uwujaren, said the operatives, who allegedly invaded the bank did so without permission.

In a statement, Uwujaren said those behind the operation acted without permission.

The commission said its modus operandi was to invite people and not to use Gestapo tactics in investigations.

The statement read in part, “Following repeated media enquiries regarding a purported raid on the head office of the Standard Chartered Bank today September 14, by operatives of the EFCC, the commission is constrained to state that there was no raid on the bank by its officers.


“The raid by operatives purportedly wearing the jackets of the commission might have been the handiwork of errant officers who acted without authorization.

“The action is in flagrant violation of the standard operating procedures of the commission as it is not the style of the EFCC to openly raid the offices of banks and other financial institutions.

“Officials of such institutions, who are wanted by the commission, are usually invited for questioning after discreet investigation. Over the years, banks have been cooperative in releasing their officers to the Commission for questioning.”

The anti-graft agency promised to investigate the matter, adding that it would leave no stone unturned.

The EFCC noted that it was a law-abiding agency and would carry out its duties professionally.

It added, “The commission will investigate the circumstances leading to this illegal raid by errant officers and those found culpable would be subjected to the internal disciplinary mechanism of the Commission.


“The EFCC again reassures Nigerians that it is an agency which adheres strictly to the rule of law and will, as much as possible, avoid draconian measures in its fight against corruption.”





























Rainbowgist