Startling revelations came on Tuesday that some bank chief executive officers sacked by the Central Bank of Nigeria for poor corporate governance and reckless credit management, may face fresh charges.
It was reliably gathered that a fresh scrutiny of the books of three of the banks—Oceanic International Bank Plc, Intercontinental Bank Plc and Afribank Plc – revealed fresh loan scams totalling about N516bn.
The N120bn hole discovered in Afribank was due to losses incurred in trading in its own shares.
Our correspondents gathered that a report from the new Managing Director of Afribank, Mr. Nebolisa Arah, revealed that the N120bn loss was as a result of a N20 diminution in the value of about six billion shares of the bank bought by the bank itself through Falcon Securities.
Shortly after a source disclosed this to one of our correspondents on Tuesday, the CBN Governor, Mr. Lamido Sanusi, told the Senate that one of the two sacked bank chiefs had two aircraft and had paid for another two before the CBN axe fell.
Our source, who is close to the apex bank investigators, claimed that Oceanic Bank, whose sacked managing director, Mrs. Cecilia Ibru, is being prosecuted by the Economic and Financial Crimes Commission, had fresh non-performing loans of about N235bn.
The loans, according to him, was traced by investigators to companies owned by Ibru herself. He added that the loans were given out at ridiculous terms that made repayment practically impossible.
About N160.7bn loans were earlier said to have been given out by the former Oceanic bank chief to her cronies and associates.
Ibru, according to reliable sources close to the investigators, also “unethically” paid N825m to a company owned by her daughter as a 10-year rent on a property along Ikorodu Road, Lagos.
When asked to name the companies that the loans were given and the one owned by Ibru’s daughter, the source said, “There is a four-page list. You will not find her (Ibru’s daughter) name on it. Many shell companies, others owned by Dele Oye and Nana Abdullahi. They even bought some other companies from people and used them for their loans.”
The source added that a fresh N160bn loan loss was also discovered in the books of Intercontinental Bank. According to him, the money was linked to market losses on Intercontinental shares bought by the subsidiaries of the bank.
He added that some directors of banks whose CEOs were sacked owned shares in the banks which they did not pay for.
Apart from Ibru, three other former bank managing directors — Mr. Okey Nwosu (Finbank); Mr. Sebastian Adigwe (Afribank); and Mr. Bartholomew Ebong (Union Bank), are facing trial on five separate 131-count charge, bordering on fraud, concealment and granting N625.95bn loans without adequate collateral.
The fifth, Mr. Erastus Akingbola of Intercontinental Bank, is on the wanted list of the EFFC.
Seven non-executive directors and members of board of directors of Intercontinental Bank Plc, Dr. Raymond Obieri; Mr. Hycinth Enuha; Mr. Christopher Alabi; Chief Samuel Adegbite; Alhaji Isyaku Umar; Mr. Bayo Dada; and Mr. Sani Adam, were also arraigned by the EFCC.
Also arraigned were three bank debtors — Mr. Peter Ololo, Mr. Henry Onyemem, and Mr. Niyi Opeodu.
Our source’s disclosures tallied with Sanusi’s defence of the shake-up in banks, where he reiterated that the activities of the sacked chief executive officers of banks were shocking, unprofessional and capable of destroying the entire industry.
Sanusi, at a closed door session with the Senate, also claimed that he rejected a Greek gift of N3bn from a group shortly after he assumed office.
He did not name those who tried to offer him the bribe.
The President of the Senate, Mr. David Mark, had said on September 29 that Sanusi would be invited to brief the Senate in a closed session because the matter was in court.
A senator, who spoke with one of our correspondents on condition of anonymity, said that the CBN chief told the Senate that the banking sector would require about N1tn to fully stabilise.
He added that there was the need for the Federal Government on behalf of the CBN, to approach the National Assembly for a legislative action on the N1tn needed.
The senator also quoted Sanusi as saying that Ibru gave out N235bn unsecured loans ; had two jets and had paid for additional two before her removal from office.
He said that Sanusi wondered why a bank chief would give out N235bn loans when the bank had a capital base of N300bn.
Part of the money, Sanusi allegedly said, was used by the executive to acquire two of the jets.
The lawmaker also credited to Sanusi as having said that the sacked directors of Intercontinental Bank approved a loan of N8bn each for themselves.
He said that the removed directors used the money to acquire about 50 per cent equity holding in the bank.
The senator added that Sanusi told the upper arm of the National Assembly that the rot in the banking sector when he took over offered him two choices.
First, to compromise and allow the system to collapse, in which case, depositors will suffer.
The second was to take the path of honour by doing the right thing if it meant stepping on toes, and to stabilise the system.
But he said that he decided to choose the latter.
In response to a question as to why some banks appeared targeted, the CBN governor reportedly said he had to make the best out of a terrible and potentially dangerous situation.
The senator said, “He gave us a scenario to illustrate his point. He said, he found himself like a person who got into a community ravaged by cholera.
“He found some children who are critically ill and others who are ill but can survive a few days.”
Sanusi, he said, was faced with the choice of trying to treat all of them at once using scarce resources, in which case he risked losing everything or treating the critically ill first, before proceeding.
When contacted, the Senate spokesman, Mr. Ayogu Eze, described Sanusi’s revelations as “startling” and “sobering.”
He said, “What I want to say for now is that revelations coming from the briefing given by the Governor of the CBN are sobering and a lot of our colleagues were really disturbed by the magnitude of the malfeasance and things that have happened in the banking sub-sector.”
Eze explained that the CBN governor would return on Thursday to shed more light on the allegations.
He also said the Senate was pleased with the action taken so far by the CBN governor in the light of his revelations and explanations.
The Senate spokesperson however said the Senate would withdraw its support if, at anytime, it found facts to the contrary.
He said, “So far, members of the Senate are quite satisfied with the way the governor has done his job, and with the way he has handled the assignment up till the briefing today (Tuesday).
“So far, we are very pleased that he had to intervene at the time he did to save the country from embarrassment.
“The facts available to us are really sobering and I am sure that at the appropriate time, when we get the facts, we will come and release some of those facts so that Nigerians too will share and see why the Senate is solidly supporting the actions of the governor of the CBN and encouraging him to do what he has started in cleaning up the financial sector and straightening things out.”
On why the discoveries were just being made, Sanusi told one of our correspondents on Tuesday that the revelation was the outcome of the work of forensic auditors.
He said, “Don’t forget that we have been in the banks since august 14. We have just concluded it, it takes time.”
Spokespersons of Oceanic and Intercontinental banks declined comments when our correspondents contacted them on telephone for comments.
(Source:Punch)
