Breaking News
Translate

Shareholders differ on CBN plans to sell troubled banks

The four shareholder groups in the country on Thursday differed on the new plans by the Central Bank of Nigeria (CBN) to sell five of the troubled banks. While two shareholder groups said that they supported the move, the other two said that they were against the sale of the affected banks.

Those that are against the move are the Independent Shareholders Association of Nigeria and the Professional Shareholders Association of Nigeria. The Nigerian Professional Shareholders Association and Nigerian Shareholders Solidarity Association of Nigeria support CBN plans.

Mr Sunny Nwosu, President of Independent Shareholders Association of Nigeria (ISAN), said that the apex bank had no right to sell the banks because they did not belong to the CBN.

“The CBN is just a regulator and its work is to issue framework on how banks should operate,”” Nwosu said.  He described the pronouncement as unfortunate and urged the government to investigate the real intention behind it. If he is genuinely working towards improving the economy of the country, he will not get to the extent of threatening to sell the banks. While other countries are working towards driving their economy, we are still experimenting. It is very clear to all of us that after one year, there has not been an improvement in the economy. How long will the reform take?” Nwosu asked

He said that the way forward was for all aggrieved parties to withdraw their cases from court and go back to the drawing board. Nwosu suggested that the directors of the affected banks and their shareholders should be allowed to recapitalise their banks themselves. Mr Boniface Okezie, National Coordinator of Progressive Shareholders Association of Nigeria, said that the CBN erred when it appointed new directors for the banks. He said that nothing was wrong with the banks at the time the CBN pronounced them sick, stressing that CBN could not sell the banks as they were not its properties.

“If the banks after one year of takeover by the new directors are declaring profit, it means that there was nothing wrong with them. What CBN should have done was to have given the old directors a time frame to recover the debts instead of sacking them.

“Another option is to allow the owners of the banks and the shareholders to recapitalise the banks themselves,” he said. But Mr Godwin Anono, Chairman of Nigeria Professional Shareholders Association, disagreed with Nwosu and Okezie. Anono commended the CBN for coming up with the new banking reform exercise. If not for CBN, more banks would have been worse hit. I commend the CBN for its efforts at revamping the financial sector. The most important thing is that the shareholders and investors do not lose their deposits at the end.


Disclaimer

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