By Udeme Clement

The suspension of the Governor of Central Bank of Nigeria (CBN), Mallam Sanusi Lamido Sanusi, by President Goodluck Jonathan, has generated divergent views. While many economics experts said the President acted hastily by not allowing Sanusi to finish his tenure by June, 2014, others said Jonathan’s decision is in the best interest of the nation’s economy.

The President had directed that Sanusi be removed from office following the report of the Financial Reporting Council of Nigeria indicting Sanusi’s tenure as characterised by acts of financial misconduct and inconsistency with the administration’s vision of a central bank propelled by the core values of focused economic management. Jonathan asked the apex back boss to hand over to the most senior Deputy Governor of the CBN, Dr Sarah Alade, to serve in acting capacity until the conclusion of on-going investigations into breaches of enabling laws and mandate of the CBN.

In a reaction, the Socio-Economic Rights and Accountability Project (SERAP) described Sanusi’s suspension as a distraction that could only contribute to shifting the focus of government from the real issue, which is finding the alleged missing $20 billion oil money.


SERAP, in a statement by its executive director, Adetokunbo Mumuni, said, “The government should not politicise the fight against corruption. Our concern remains the urgent, thorough, transparent and effective investigation into allegations that $20 billion oil money is missing from the account of the Nigerian National Petroleum Corporation (NNPC).”

“If it is true that the suspension is linked with Sanusi’s public disclosure of the missing funds, SERAP believes that this is clearly wrong and contrary to the government’s obligations under the UN Convention against Corruption to target a whistle-blower simply for bringing the information to the public domain. No one should be victimised for contributing to the fight against corruption, which is the moral and legal responsibility of any serious, open and people’s oriented government.”

“Unless the government comes clean about what exactly has happened to the $20 billion missing oil money, the NNPC will remain unaccountable to Nigerians for its action. This would not be consistent with the attitude of a government establishment funded with tax payers’ money. The government’s action in finding the missing money and punishing suspected perpetrators is critical if it is to enjoy the trust and confidence of Nigerians in the fight against corruption.”

The Sanusi reforms/monetary policies

Biometric data authentication:

The biometric data capturing for commercial banks doing business in Nigeria was the last monetary policy initiated by the Sanusi before his suspension.  The CBN had given all commercial banks operating in Nigeria 18 months to begin and conclude the biometric registration of all customers across the country. Sunday Vanguard gathered that before launching of the scheme recently, banks in collaboration with the monetary authority had been working on this new policy initiative for a long time, even as necessary infrastructure had been put in place to enhance successful and smooth rollout of the data identification project nation-wide.

The CBN last week launched the Bank Verification Number (BVN) for biometrics identification of customers in the financial industry, designed to reduce fraud, money laundering in order to revolutionise the payment system in the country. With the new directive, banks were to start the registration of fingerprints as well as facial features of customers, as the project was being controlled by the monetary authority with a time-line of 18 months to ensure efficiency.

Removal of arbitrary bank charges by CBN:

The removal of arbitrary bank charges by the apex bank was sequel to complaints from depositors about what they described as arbitrary bank charges on banking services. In that capacity, the apex bank issued a draft of the Revised Guide to Bank Charges benchmarking lending rates to Monetary Policy Rate (MPR) for maximum of 8 per cent across board, which translated to 20 per cent. The target was to align the tariff regime with the economic challenges and realities in the country.

Also, the CBN set up a consumer protection unit to enable consumers lodge complaints, stressing that banks were charged to refund customers when they over charge customers for certain services and products. Beyond that, the sub-committee of the Bankers Committee on ethics investigated issues of excessive bank charges and any commercial bank found contravening the law was sanctioned accordingly. The apex bank went ahead to issue a circular for the review of the extant guide to bank charges that had been in use since January 2004 fiscal year. The exercise paved the way for minimum disclosure from banks to all customers prior to the consummation of every credit transaction.  A glossary of terms was developed to provide clear definition of technical terms used in the guide to reduce misrepresentation or any form of ambiguity while protecting consumers from arbitrary charges.

The Banking industry/outstanding reforms:

The banking sector under Sanusi experienced numerous reforms ranging from merger of some weak banks to the removal of N100 charge on the use of Automated Teller Machines (ATM) recently. Some of the reforms in the sector include, cashless policy, which limits the level of withdrawal by individual to N500.000 and corporate body to N3million, attempt by the Central Bank of Nigeria to introduce N5.000 bank note, currency restructuring among many others.

For instance, in first quarter of 2012, Access Bank Plc and Intercontinental were fused into one entity, Ecobank acquired Oceanic Bank, Spring bank became Enterprise Bank Limited, First City Monument Bank acquired FinBank,  bank PHB became Keystone Bank Limited, Afribank became Mainstreet Bank Limited, Sterling Bank acquired Equitorial Trust Bank while Union Bank of Nigeria is now owned By African Capital Alliance Consortium.

5,000 naira bank note controversy:

The attempt by CBN to introduce 5.000 naira note into circulation by first quarter of 2013 and to redesign the existing N50, N100, N200, N500 and N1000 notes with new security features, while N20, N10 and N5 notes would be changed to coins sparked controversy in the country and was unsuccessful.  Sanusi had explained that the policy initiative formed part of the currency restructuring exercise by the apex bank, adding that the front side of the new currency must be adorned with the pictures of late Margaret Ekpo, Funmilayo Kuti and Hajiya Gambo Sawaba, while the back side would have the National Assembly structure on it. While some financial analysts said the policy could contradict the cashless regime already on-going, others frowned at the CBN’s plan to spend a whopping sum of N40.3 billion for printing of N5.000 note, when the country was facing perennial security crisis, abject poverty and unemployment.

The approval of N200 billion commercial agric credit:

Sanusi disclosed that the apex bank created the N200 billion Commercial Agriculture Credit Scheme (CASS) Fund in 2009, and the funds were being disbursed through the deposit money banks (DMBs) to local farmers to enable them improve their production capacity. The loan scheme had an interest rate that did not exceed 9 percent and the maturity period of not more than 7 years, to enable local farmers expand their capacity to create more jobs and enhance revenue generation. Sunday Vanguard gathered that about 109 projects made up of privately-owned projects had been financed with part of the money, while 19 state governments received N1 billion each for disbursement to farmers’ cooperatives and unions within their constituencies, by February last year. Aside from the N200billion agric credit scheme, in 2010, a huge sum of N500 billion was approved as an intervention fund for the manufacturing industry.

His appointment/suspension:

Sanusi was nominated by the late President Umaru Musa Yar’Adua, as governor of CBN, on 1 June 2009 and his appointment was confirmed by the Senate on 3 June 2009, during the period of the global financial crisis.[8] Sanusi who took over from his predecessor, Charles Chukwuma Soludo, immediately went into action by removing the chief executives of some banks to sanitise the industry. In August that same 2009,  Sanusi put measures in place to rescue Afribank, Intercontinental, Union Bank, Oceanic Bank and Finbank, with a bailout of N400.  From that moment till his removal, the CBN under Sanusi initiated one monetary policy after another to put the banking sector back on track and to restore confidence of the banking public.


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