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FG owes troubled banks, others N3.2 trillion, says Fasehun

By Abdulwahab Abdulah
THE last may not have been heard about the crisis facing Nigerian financial institutions as the Yoruba socio-cultural group, Oodua People’s Congress (OPC) leader Dr Federick Fasehun yesterday disclosed that the Federal Government  is owing Nigeria banks a sum of N3.2 trillion.

A fresh twist was added to the ongoing crisis facing the five troubled banks when OPC accused the Federal Government and the Governor of the Central Bank of Nigeria (CBN), Sanusi Lamido  acting out what  Vanguard newspaper published five months ago.

Dr. Frederick Fasehun, Founder and President, Oodua Peoples' Congress (OPC) and Mr. Adeoye Jolaosho address a press conference on CBN's hammer on 5 banks' executives Lagos.by Sylva Eleanya.
Dr. Frederick Fasehun, Founder and President, Oodua Peoples' Congress (OPC) and Mr. Adeoye Jolaosho address a press conference on CBN's hammer on 5 banks' executives Lagos.by Sylva Eleanya.

Addressing journalists in Lagos, founder and president of OPC, Dr Frederick Fasehun bombarded both the CBN leadership and the administration of President Umar Yar’Adua, saying  that the Federal Government of Nigeria is one of the ‘big debtors’ that are killing Nigerian banks.
Specifically, Dr. Fasehun said Federal Government alone is owing Nigerian banks, including the troubled banks to the tune of N3.2 trillion, representing over $220 billion. He said: “These uncleared government debts certainly compounded the problems of the banks. The Federal Government as well as local contractors owe over N1.5 trillion; many of these loan obligations, these contractors have been unable to discharge.”

Fasehun therefore queries the CBN and the Federal Government’s moral rights to attack the five banks and also injected N420billion public funds into the banks. He based his arguments on the fact that both the CBN and Government of Yar’Adua are  acting a prepared script.

Quoting the Vanguard exclusive reports on the banks to support his arguments, Fasehun said: “But many Nigerians like me cannot forget the fact that just last March, Vanguard newspaper exclusively reported that some faceless interests planned to take over five banks. Initially, we took the story with a pinch of salt. But the benefit of hindsight has bestowed upon that Vanguard report an uncanny degree of accuracy, because not only did it pinpoint the five target banks to be disgraced, it also identified the future CBN Governor that would undertake the job.

“Now that the newspaper’s prediction has materialised, the public will like to know if this whole affair were not a carefully scripted secret agenda. In the light of this newspaper’s accurate prediction five months ahead, can we resist the urge to say that these banks and their executives were simply sitting ducks for a well-schemed frame-up?”

Fasehun therefore queries the CBN and the Federal Government’s moral rights to attack the five banks and also injected N420billion public funds into the banks
Fasehun therefore queries the CBN and the Federal Government’s moral rights to attack the five banks and also injected N420billion public funds into the banks

He said that the CBN Governor took several wrong steps in his efforts to right the wrong allegedly committed by the five banks. He accused Lamido of not following due process and that the injected government’s fund and invitation of foreign investors were part of the plan to take over the banks.

Accusing the CBN Governor of hidden agenda, he said Sanusi has “always remained unapologetic and  unrepentant of his ethnic chauvinism.” He said “Curiously too, we find that these five banks are headed by Southerners, Because of this fact, we will caution the CBN to refrain from fanning the embers of Northernisation, which the Umar Yar’Adua administration appears determined to push since its inception. Otherwise, we will be fighting corruption with corruption and the result will be greater corruption.

“Apparently, this insinuates that the CBN has not told us the whole story. Our private investigations, for example, show that the Federal Government itself owes Nigerian banks about N3.2 trillion, roughly over $220 billion. These uncleared government debts certainly compounded the problem of the banks. The Federal Government as well owes local contractors over N1.5 trillion; many of these represent loan obligations these contractors have been unable to discharge.

“So does the government really have the moral right to cast stones? It would be wiser for the Federal Government to lead by example and first liquidate its own debts before pointing fingers at ‘fellow partners in debt.’ Maybe for all these unpaid government debts, the CBN should go ahead and hand over the Accountant-General, Auditor-General of the Federation and the Minister for Finance to the Economic and Financial Crimes Commission (EFCC) as well. Curiously too, all the loans that the CBN has taken to the cleaners are private loans. What about those various bonds and loans that state governments secured from the capital market and the banks; why has the CBN not addressed them?”

He noted that as at April this year, all the banks borrowed N8.7 trillion from CBN, making all of them liable. “So, if the five banks under investigation borrowed only N800 billion out of the gross N8.7 trillion released by the CBN, which other banks make up for the balance of about N7.9 trillion? Why have they been spared? And why should the CBN deal with a general problem instalmentally ? Let the CBN tell the-whole world where its N8.7 trillion went to?”

He said what needs to be done was for the CBN to handle the problem administratively, considering the fragile and sensitive nature of the financial markets. “It is very unfortunate that the CBN is criminalizing a routine commercial financial transaction.”

He also spoke for the shareholders, asking what would be their fate in the on-going process, if the troubled banks are sold to foreigners.

Blaming government for the problems, he said “Suffice to say that although some of these controverted loans are inexcusable, a lot of them would have performed if only government had delivered on key economic issues. including: Stabilizing the Naira, providing electricity supply, pushing through the amnesty deal to secure a viable bridgehead for profitable oil business in the Niger-Delta, enhancing Nigerian’s buying power by providing employment, ensuring good road networks, lighting corruption, resolving the crisis in the education sector especially the ASUU strike and succeeding with the seven-point agenda.”

To save the situation , he called on the National Assembly to urgently pass a motion ensuring “that existing shareholders are given an opportunity to recapitalise these five banks within a time frame not less than 180 days.

These banks are public companies owned by several Nigerians. They must not suffer double jeopardy. Their preemptive rights as existing shareholders, which is duly recognised by Companies and Allied Matters Act, Banks and Other Financial Institutions Act. C B N Act and the records of CBN must be protected and respected.”


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Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.