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CNPP flays N400bn bail-out for banks

By Chris Ochayi
Recent decision by the Central Bank of Nigeria (CBN), Governor, Malam Sanusi Lamido, to inject N400 billion to raise the fortune of ailing five commercial banks was illegal since the National Assembly did not authorise the action, the Conference of Nigerian Political Parties (CNPP), has said.

Rising from its third quarterly meeting, weekend, in Abuja, CNPP, however, stated that, without prejudice, the CBN’s action is illegal and simple.

The umbrella of opposition registered political parties, which made the remarks in a statement signed by its National Publicity Secretary, Mr. Osita Okechukwu, also condemned the Professor Charles Soludo’s N256.5 billion Expanded Discount Window, describing it as an illegal expenditure and totallly unauthorised.

Drawing from the recent analogy in the United States of America (USA), Okechukwu argued that, “we are all witnesses how Presidents Bush and Barrack Obama battled to get the US Congress to appropriate their stimulus or bail out funds”. CNPP also derided ex-President Olusegun Obasanjo for being responsible for the nation’s rotting financial sector.

“CNPP has for the umpteenth time condemned the warped and anti-people unholy alliance between Corporate Nigeria and Chief Olusegun Obasanjo’s Peoples Democratic Party (PDP), their economic programme, privatisation racket, unconventional commercial bank papers profits and monumental corruption; which was the metaphor of the last 10 years, bearing in mind that one day the bubble will burst.”

The bubble he said “is burst as the Capital Market and the Banks are undercapitalised, suffer excessive high level of non-performing loans and cannot meet their international obligations”.

“We had posited that for a primitive economy like ours the route to development is the huge investment of our unprecedented oil revenue on infrastructure not total dependence on private investors; PDP the ruling party leadership up-to-date is still waiting for private investors while fleecing our oil revenue”.

“CNPP in league with financial experts is yet to identify which of the Banks is immune from the toxic privatisation racket, fuel and other essential products importation debt over-hang and the unholy alliance of Corporate Nigeria to the Capital Market, which led the Banks to undue liquidity strains”.

“Nobody for instance has explained to Nigerians how First Bank recovered from the over N1 billion it borrowed to IIL, the first company packaged by Chief Obasanjo and cohorts to buy NITEL, which crashed and led to the dismissal of Chief Longe the then managing director of the bank”.

“Or how can one explain that the managing director and deputy of Access Bank through their company – United Alliance Company is owning N16 billion to Intercontinental Bank?”

“For the avoidance of doubt, CNPP’s Communiqué notes that neither the CBN Act, Banks and Other Financial Institutions Act {BOFIA} nor any other extant law can override Section 162 of the Constitution of the Federal Republic of Nigeria which clearly states, ‘The Federation shall maintain a special account to be called ‘the Federation Account’ into which shall be paid all revenue collected by Government of the Federation,…’ and going further to Section 81 of the same Constitution, to the best of our knowledge that there was no time the National Assembly appropriated nor authorized CBN to inject with immediate effect N400 billion into the five banks so far identified to have collapsed; to be repaid from the proceeds of capitalization in the near future. This without prejudice to good intention is illegal pure and simple.

“Whereas, CNPP sympathizes with depositors, our fear is that since only 10 banks had passed through the forensic audit, the tendency is that more casualties are online, which means that we may end up fleecing over N2 trillion in bailing out the Banks and by extension the toxic Capital Market”.

“The danger is that Nigerians and indeed the EFCC, CBN Governor should note that the same clique – Corporate Nigeria and PDP leadership in similar manner squander our Foreign Reserve through doubtful transactions via Capital Flight, that today our Foreign Reserve has nose-dived from $62 million to $42 million in less than 12 months”.

“In prudently managed economies minimum amount that guarantees external trade for minimum of 3 months are foreign reserved for genuine transactions and the rest invested in infrastructure; this does not tally with the self interest of Corporate Nigeria and their PDP alliance”.

“Consequently, the N400 billion injected and the N256.5 billion ‘Soludo Expanded Discount Window’ are to our considered view, illegal expenditures, totally unauthorized, for we are all witnesses how Presidents Bush and Obama battled to get the US Congress to appropriate their stimulus or bail out funds”.

“The era of expenditure by whims and caprices or immediate effect should be a thing of the past, as they are not only illegal but unconstitutional; for in all sincerity when President Yar’Adua is ready to bail out our collapsed economy, we shall out of urgent national importance start with the fundamentals –Electricity, Niger Delta, Refineries, Railways, ASUU etc – not the financial scam between Corporate Nigeria who borrowed without collateral to criminally acquire State Owned Enterprises like NITEL, NICON INSURANCE, NAFCON ONNE, AFRICAN PETROLEUM,AGIP and Corporate Nigeria who play Casino games in the Capital Market”.


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