In a circular to all banks titled “De-Marketing of Banks by Other Banks”, and signed by the Diector Banking Supervision, Mr. Ignatius Imala, the CBN stated, “it will be recalled that the CBN had earlier issued a circular reference BSD/08/2006 on the above subject titled “The Unethical and Unprofessional Practice of De-Marketing Colleagues/Other Banks in the Industry by Spreading  False Rumours”, dated April 12, 2006.

The CBN has again noted with serious concern the recent practice whereby some officers of deposit money banks engage in the de-marketing of other banks through disparaging comments and the use of negative text messages.

This development, which constitutes a threat to the safety and soundness of the banking system, is unprofessional, unethical and unacceptable. Banks and their staff are by this circular reminded that the responsibility for ensuring the safety and soundness of the banking system is a collective one for all stakeholders.

Banks are therefore advised to caution their staff on this practice as henceforth, any staff of a bank found to be involved in such an act will be summarily dismissed and blacklisted. Also, if another staff of the same bank is involved in such a practice, the institution will face severe sanctions including but not limited to a monetary fine of N10 million (Ten Million Naira only).

Appropriate channel will be opened by the CBN for the report of such unwholesome practice by banks’ customers and the general public. Furthermore, in the overall interest of the banking system, all banks are advised to enthrone an appropriate corporate culture that would guide against such
practices in the future.”

It would be recalled that last week an intense  struggle  among the banks precipitated by  indications that the Nigeria Stock Exchange (NSE)  has approved First Bank, Union Bank, Intercontinental Bank, Zenith and UBA to be market makers, occasioned spin-offs against the five banks through text messages alleging that the banks, which actually initiated the arrangement, have liquidity problem due to over exposure to the stock exchange.

The text message which was widely circulated in the industry alleged that the banks had bought the stocks of so many companies including their own shares when the market was good and are exposed to the market the tune of over N500 billion and that they have stopped giving loans.

Concequently, Chief Executive Officers of Banks met to address the development and  resolved that all banks should issue internal memorandum warning their staff to desist from spreading rumors aimed at de-marketing other banks, and that any staff caught in the act will be dismissed from the industry.

It was also resolved that any bank caught de-marketing another bank would be blacklisted from the interbank money market.

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