Frankly Speaking

June 14, 2009

Thanks, Governor Lamido Sanusi

By Dele Sobowale
A foolish consistency is the hobgoblin of little minds, adored by little statesmen. —Ralph Waldo Emerson, 1803-1882.

Hain’t we got all the fools in town on our side? And Hain’t that a a big enough majority in any town? —Mark Twain, 1835-1910, Vanguard Book of Quotations p.63.

SOMETIMES procrastination might not be the thief of time, as the old adage has  it.

It might save one from embarrassments and regrets. The case of the new governor of Central Bank is a case in point.

I had originally planned to carpet the president for what I thought was a lopsided selection of his top staff on the grounds that they violated the Federal Character principle as enshrined in our constitution. But, I was also caught in a dilemma.

For years, I had advocated meritocracy, even if it meant jettisoning the basic principle of equitable representation in government. So when the choice of the new governor was announced, my first instinct was to disagree with it because it violated the principle of Federal Character and because too many of Yar’Adua’s appointments have been so parochial they reflect the man’s destitution for a national view of selection.

Virtually all the top posts that are worth having in this government have gone to people from three or four states – usually Kano and Katsina.

I was even going to blast all the senators from the three southern zones who would vote for the appointment – irrespective of their political party.

But, then a guiding hand touched me and counseled that I should wait for Sanusi’s visit to the Senate; known usually for “take a bow and leave” approach to assessment of candidates for high office.

The Senate president apparently cannot often wait to get to his pounded yam and okoho soup. Thank God this was different and that difference produced a total turnaround in my perception of things.

Strangely enough, the attributes which have now turned me into a praise-singer of the governor, are the very ones that have generated misgivings between him and the Federal Government.

Three statements stand out of the trope of  words uttered at the hearings. The first was his description of the seven-point agenda as too vague and without content. The second was his admonition to government to stop visioning and start acting.

The third was his reminder to us that big banks don’t necessarily mean healthy banks. For the first he recommended prioritization; for the second he called for real action instead of sloganeering.

And for the third he tried to restrain us from the euphoria associated with banking consolidation by pointing out the N1 trillion exposure being experienced by the banks at the moment.

Let me address the third first, because that had not disturbed the Federal government which might be thinking about reversing the policy underlying consolidation.

If size alone were the sufficient and necessary condition for a sound bank, then none of the leading U.S banks should be bankrupt today.

Size, while it protects against small shocks, is totally worthless when earthquakes arrive. The statement, “the bigger they are, the harder they fall” applies here. One big bank going down can take with it several more enterprises than ten small banks.

And given the great exposure of Nigerian banks, today, and the extent and nature of which are still closely guarded secrets, only a fool will bet that all is well. For lack of a better term let me call what has evolved “consolidation of risk”.

Associated with the consolidation of risk are two developments; one of which keeps recurring each time we have a new initiative which proves to be temporarily effective.

That initiative becomes like the only answer to all our problems. But, we need to be reminded about what happened in the early 1990s when banking deregulation was first introduced.

Within months banks were all over the capital market raising funds and declaring unprecedented dividends.

The leading bankers at the time became folk heroes and they dominated the proceedings of the Nigerian Economic Summit Group.

Less than five years after it all started, the bubble collapsed and the “men-about-town” became fugitives from the law.

Then banking regulations had to be strengthened to protect depositors against rapacious bankers or what I called then “robbers in designer suits”.

Some “gun-slingers” are still within the system and only time will reveal them.

Furthermore, consolidation had resulted in almost total exclusion of the North from the executive suites of banks.

Of the 24 consolidated banks, only one is headed by a northerner and even the share ownership has shifted strongly against the north.

It is to be expected that the situation, which the former governor regarded as a minor issue will continue to be regarded as some sort of injustice to the north.

Even, the Unity Bank Plc which the north managed to hold on to is a fringe player in the sector.

That is a fact which we ignore at our peril and it might have influenced the decision to appoint a northerner as governor of Central Bank. As for me, I expect a slight change in the consolidation policy any time soon. And, I welcome it.

The comments on seven-point agenda and the Vision 2020 were actually the most surprising.

Hitherto, one had been under the impression that no leading northern personality would openly disagree with a northern president; even if patently wrong. Yar’Adua, like other presidents before him, has quickly acquired an aura of infallibility, judging from the utterances of some of his “Advisers” who two years ago were writing intelligent criticisms of government policies as editors and columnists.

That was expected, it was also par for the course that every minister, contractor, PDP stalwart wanting a slice of the national cake, will openly support the meaningless agenda.

The former governor of CBN went along, in my view, not out of conviction, because he knows enough economics to drill holes in the propaganda, but because he probably thought it would help in his second term ambition.

Had he asked me, I would have told him that his fate was sealed when he announced decimalization.

Two days in Kano and Kaduna talking to “movers and shakers” convinced me of that and I wrote it at the time. Thus, it required an exceptionally courageous man in high government circles to tell the truth which others have been evading.

I have since read the statements of the government’s spokesman, who is an amateur in propaganda and probably does not realize that a lot of Nigerians can interpret a statement themselves and don’t need any spin doctor to help them out.

The whole attempt at face saving, after that slap in the face, is unconvincing. Prioritisation means you concentrate on one or two and leave the rest; at least for now; nothing more and nothing less.

A government which cannot even write a decent budget has no business talking about seven-point agenda or Vision 2020.

he insistence on consistency by this administration is indeed the hobgoblin of one “little statesman” who can only chair the F-20 Summit because he is not good enough for G-20.

Welcome, Governor Lamido Sanusi; coming from the north will no longer be held against you; at least not in this column.