By Omoh Gabriel, Babajide Komolafe & Micheal Ebo
The Central Bank of Nigeria (CBN) has said that shareholders of the eightÂ troubled banks it bailed out recently do not have ownership claim on the banks saying they have lost their capital.
Speaking during his visit to the corporate headquarters of Vanguard on Thursday, Sanusi said, â€œ
â€œShareholders need to understand what we are doing and we are merely being charitable when we talk about shareholders. Look, youâ€™ve lost your money.Â If your capital is zero or negative, you no longer have a bank.
That is the truth people do not want to hear. Somebody says heâ€™s speaking on behalf of shareholders. If we publish what we have, they will see; there is no capital, itâ€™s been gambled away _ that is the truth. But weâ€™re trying to have discussions so that the shareholders would still have somethingâ€.
Sanusi Lamido Sanusi said that it for this reason that the investment of the ordinary man on the streets have been lost that those responsible must pay.
According to him â€œPeople are complaining that weâ€™re causing some rich people discomfort. These are people who believe in their mind that they are rich. What I get is not so much the rectitude of it but people feel scandalized â€˜how dare you publish my name; how dare you say I should come and payâ€™. They must pay.
â€œPeople have got used to this mentality of when a bank is distressed, they go to NDIC for liquidation and that is all but this time it is different.Â People on the streets must know that their banks have been badly managed, that this bank does not have capital adequacy ratio.Â The act even says nobody who is not licensed by CBN should operate a bank.
Where are the people who took away the money, they come back and contest elections. Weâ€™ll ensure that the common man on the street gets protection, but you the big man who is trying to cause people pain, you will pay.
â€œLook, let me tell you, the same people whose name you see on the list of bad debtors are the same people messing up the polity, messing up the petroleum sector, messing up the power situation in the country, they are the same people who are going to rig elections so we have to deal with them. That is true. Is that the mandate of the CBN governor? It is not. But it is the mandate of Nigeria and I am a Nigerianâ€ he stated boldly.
It will be recalled that on August 14 the CBN Governor had accused the troubled banks of huge non performing loans for which the Managing and Executive Directors of five of the banks were sacked and later three other banks were visited with the same treatment. According to Sanusi then the total loan portfolio of these five banks was N2,801.92 billion.
Margin loans amounted to N456.28 billion and exposure to Oil and Gas was N487.02 billion. Aggregate non-performing loans stood at Nl,143 billion representing 40.81 per cent. It is evident he had said that the five banks accounted for a disproportionate component of the total exposure to Capital Market and Oil and Gas, thus reflecting heavy concentration to high risk areas relative to other banks in the industry.
The huge provisioning requirements he stated have led to significant capital impairment. Consequently, all the banks are under capitalised for their current levels of operations and are required to increase their provisions for loan losses, which impacted negatively on their capital. Indeed one Is technically insolvent with a Capital Adequacy Ratio of (1.01%).
Thus, a minimum capital injection of N204.94 billion will be required in the 5 banks to meet the minimum capital adequacy ratio of 10m per cent.