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Sacked CEOs of stressed banks - Matters arising
Posted by Afam on August 19, 2009, 12:13 pm
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Why are we even talking about non performing loans or bad debt when we know that the conditions for accessing loans from Nigerian banks are more than enough to guarantee the security of any loans given out?
Approach any bank for a loan and by the time you are done discussing with the bank about the loan then it will be clear to you that no bank has the right to talk about bad debt or non recoverable loan unless of course the bank applies the same rule differently yo people depending on how the bank feels as at the time of approving or granting the loan.
So, why are the banks threatening to go to any length to recover the loans? What about the collaterals? Or, were the funds given out without any form of collaterals?
From my estimation and from the little I know about the conditions for loans from banks in Nigeria it actually pays a bank for any debtor to default because the collateral is usually many times higher in value than the actual loan collected so in the event of default the collateral will not only recover the loan but will do so at an added profit.
From the situation of things on ground it seems that majority of these loans had no collaterals attached to them. I guess all it takes to access loans from the indicted banks is to have a recognizable face that has anything to do with politics in Nigeria.
Not business men, certainly not enterprising and dynamic young Nigerians with ideas that could translate into major successful start ups or companies, no, people that belong to this group cannot even access N500,000.00 or N1M or N2M to inject into their businesses or ideas because they may not have the opportunity to occupy political offices where they can steal and loot public funds.
What about the auditors? Remember the fall of one of the most respectable audit firms in the world - Arthur Anderson when Enron collapsed?
Now, we need to talk about the auditors that are simply partners in crime in this reckless and wicked mismanagement of depositors and shareholders funds by the CEOs of the indicted banks.
How much did these banks pay the auditors for them to help them cook the books? Are these auditors innocent of the financial crimes committed by these banks?
As we await the rest of the audit of the remaining banks we can only hope that Mr Sanusi is allowed to finish what he has started and more importantly that he is allowed to sanitize the banking industry so that genuine businesses and dynamic Nigerians who have viable ideas can access small loans that may just help in keeping the economy moving while creating jobs in the process.
Jail terms must be the end game if the exercise must make any sense considering how some of the convicted corrupt Nigerians have gotten off the hook with a slap on their wrists.
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