* Sanusi moves to check effect of clampdown
* Ibru petitions EFCC over bail conditions
By our reporter
SIXTEEN of the over 60Â bank executives being detained by the Economic and Financial Crimes Commission, EFCC, are to be arraigned in Lagos tomorrow on sundry charges of lending money to customers without collateral.
And as the effects of the clampdown on the banks by the Central Bank (CBN) begin to manifest, the governor of the apex bank, Mallam Sanusi Lamido may have commenced, with his London trip, the battle to save the nationâ€™s economy from the backlash.
Among those expected in court tomorrow are: Mrs. Cecilia Ibru (former MD, Oceanic), Mr. Sebastin Adigwe (Afribank), Mr. Okey Nwosu (Finbank and Mr. Bartholomew Ebong (Union). The fifth former MD, Dr. Erastus Akingbola is abroad and has been declared wanted by the Commission. It was not clear last night how many charges may be brought against them.Â EFCC sources said the charges were still being compiled.
Efforts by the detainees to go home on bail have remained unsuccessful following their inability to meet the conditions attached to the bail. One of the conditions is that each of them should deposit N1 billion in form of a bank guarantee procured from a bank not indicted by the on-going CBN investigation. Besides, each of them must have a surety who is a member of the Federal cabinet.
Sunday Vanguard gathered that while the detainees have been finding life rather hard in the EFCCÂ cell, Mrs. Ibru appears to be hardest hit.
*Cecilia Ibru petitions EFCC :Â She has already sent a petition to the EFCC complaining about the bail conditions. In the petition to the chairman of EFCC, Mrs Farida Waziri, Mrs Ibru specifically challenged the conditions to pay N1 billion and procure a serving minister as surety.Â She described the conditions as â€œstrange and alien to the Constitution of the Federal Republic of Nigeria 1999 and other extant laws of the country.â€
The letter written by her lawyer, reads in part, â€œDr. (Mrs.) C. Ibru (OFR) is our client who reported to your office on Wednesday, August 26, 2009 from her hospital bed on your invitation.
Since her said report, she has been held in your Commissionâ€™s custody without any charge preferred against her and without her being granted bail to go home in spite of her failing health.
â€œThe state of her health was brought to the attention of your Commission through a medical report but same received no sympathetic consideration. Rather, what she got was a bail condition that is strange and alien to the Constitution of the Federal Republic of Nigeria 1999 and other extant laws of the country.
â€œSuffice it to say that our client had earlier sought and obtained an order of a Court of competent jurisdiction to enforce her fundamental human rights against your Commission, the Police and other security agencies on August 25, 2009 in Suit M/671/09 which was served on your Commission on August 26, 2007. Copy of the said order which speaks for itself and the affidavit of service are attached herewith for ease of reference. Respect for the rule of law in all its ramifications is sine-qua-non to the right against all ills of the society and we dare say that no resort of jack-book tactics in fighting same has ever succeeded in any part of the world.
â€œIt is rather unfortunate that years after, your Commission had been upbraided over this illegal act, it has found it expedient to go back to the unconstitutional act of asking our client to produce a bond of N1 billion and a serving Minister as a surety.
These are conditions which no Court of competent jurisdiction will impose on any suspect. We, however, wish to demand that your Commission should operate within the ambit of the law setting it up and most importantly the Constitution of the Federal Republic of Nigeria, respect the orders of the Court and their rulings by allowing our client to go home on bail on constitutionally recognised conditions or in the alternative charge her to Court within 24 hours as stipulated under the provisions of Section 35 of the Constitution.
The idea of holding a suspect first before investigating a crime is not part of our law and is alien to the countryâ€™s Constitution. This was made clear in the attached Court order. This demand you will agree is not too much for us to ma
ke and certainly not too much for you to meet.â€
He saidÂ if the demands contained in the letter are not met within a reasonable time, â€œwe would have no option that to return to Court against your Commission with all the attendant embarrassment.â€ The counsel noted that the idea of holding suspects first before investigating a crime â€œis not part of our law and is alien to the countryâ€™s constitution.â€
Sanusiâ€™s mission to save economy However, Sunday Vanguard gathered that the real objective of the CBN governorâ€™s trip was to assure foreign banks of the guarantee of all loans and credit lines granted Nigerian banks by them. The assurance was necessitated by the rate at which some foreign banks have been turning down letters of credit from Nigerian banks in the aftermath of the clampdown on some of them. The CBN clampdown, according to industry sources, came at a time investors were beginning to develop confidence in Nigerian banks, granting them lines of credit and rating them high.
Bankers, citing policy reversals by Nigeria, said the situation posed a big threat to the growth of the economy. For instance, the Union Bank which Mallam Sanusi will not mind selling to foreigners 100 per cent had proposed to offer 40 per cent of its shares to a foreign bank only to be stopped by the immediate past CBN governor, Professor Chukwuma Soludo. His reason was that the apex bank would not allow any foreign bank acquire majority shareholding in the recapitalized bank.
It is also feared in the petroleum sector that the clampdown may slow down fuel importation if availability of credit is not guaranteed. At his London conference on Friday, the CBN governor said: â€œThe banking sector is key to Nigeriaâ€™s economic prospects and that the nation will see economic growth of five percent this year, rising to double-digit rates from 2010 as its banking sector strengthens again after a $2.6 billion bailout.
He told his audience comprising international banks, lenders and rating agencies in London, that Nigeria economy was likely to expand five per cent in the second half of 2009 after growing at a similar pace between January and June. â€œI have no doubts that by 2010-2011 we will be looking at double digit growth in Nigeria. We were growing at 6 per cent without electricity, without peace in the Niger Delta,â€ Sanusi said, referring to unrest in the countryâ€™s oil heartland. “We are a country of 150 million people but with only 23 million bank accounts. So there is a lot of room for growth.â€
The Central Bank following its move against the five banks, injected N400 billion into them and sacked their senior management, saying lax governance had left them so weakly capitalised that they posed a systemic risk. According to him private sector credit outstripped the entire spending of the countryâ€™s federal, state and local governments last year and this year banks are expected to provide much of the governmentâ€™s estimated N1.6 trillion borrowing needs.
Sanusiâ€™s bailout, just two months after he took office at the helm of the regulator, shocked corporate Nigeria and initially panicked financial markets, sending the naira currency lower and triggering a stock market sell-off.Â S&P cut Nigeriaâ€™s speculative sovereign long-term foreign currency credit rating one notch to B-plus from BB-minus last week, citing the costly bank bailout and falling oil revenues.
â€œWe have peace in the Niger Delta, inflation has been coming down. If the downgrade had come 3-4 months back it would have been more understandable,â€ he said. Before the bank bailout he forecast that Nigeriaâ€™s economy would likely expand by five per cent this year, but analysts in a Reuters poll this week predicted aÂ 3.6 percent growth.
He told the London conference that non-oil GDP growth should be â€œrobustâ€ at above six percent this year, and projected an inflation rate of nine percent at the end of the year. Nigeriaâ€™s consumer inflation dipped to 11.1 percent year-on-year in July from 11.2 percent the previous month. Sanusi cut interest rates to six percent from eight percent in July, following his first monetary policy meeting as governor. He also said Nigeria would get $2.8 billion in special drawing rights from the International Monetary Fund this yearâ€.