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What should customers of Savannah Bank Do? (2)

By Babajide Komolafe

The first part of this article which appeared two weeks ago generated many comments and reactions from readers online. However many of them missed the point and the objective of the series on the Savannah bank saga.

Most of the responses dwelt on the past, vis-a-vis the factors and forces that led to the closure of the bank. This series however is about the future, with the aim of highlighting the plight of the depositors of the bank. This is because the past is past. We cannot change the past, but we can influence the future. The damage and losses of the last 15 years of the bank’s closure cannot be undone, but we can reduce how much will be lost and destroyed in the years to come.

Secondly, irrespective of the forces and factors that occasioned the closure of Savanah Bank, the depositors are the number one stakeholders and they are the ones that suffer the greatest loss. The owners of the bank, or shareholders, majority and minority have the wherewithal to withstand the loss they may have suffered due to the closure of the bank, but most of the depositors do not. And this is reflected in the account of Mr. Uche Ephraim published last week. The closure of the bank directly and indirectly led to the death of many depositors and pushed millions below the poverty line. Hence efforts should be concentrated on the depositors of the bank, on how to make sure that they do not suffer longer than they have suffered.

That is why the depositors of the Savannah Bank must not allow the Central Bank of Nigeria (CBN) or the shareholders of the bank to determine when they can access their money trapped in the bank. The CBN nor its staff do not and will not incur or suffer any loss irrespective of the number of years Savannah Bank remains closed. Hence waiting for the CBN to access their money may amount to waste of time. But as suggested two weeks ago, the depositors should start with dialogue with the apex bank, with clearly articulated demands and deadlines. But if this option fails to yield positive result, depositors should proceed to the courts. They should institute legal action against the CBN and the owners of the bank.

One of our readers in his response had argued against the suggestion that depositors should come together and take action. He stated, “ I read your comment on this issue but I was not satisfied by your recommendation. I can only imagine share holders to “ come together “ to pursue a common objective not depositors that are all over the country and even beyond. There is no known forum for bringing depositors of banks together. It’s just one of those acts of impunity and lawlessness on the side of government and her agencies that played out on Savanah bank saga. The bank had obtained court judgement that CBN was wrong in closing the bank but the same court failed to protect depositors.”

The gap in this response is that the depositors have more locus standing than the minority shareholders of the bank. Secondly, the loss and the pain of the depositors greatly outweigh that of the minority shareholders. Hence their action would carry more weight and likely generate serious reactions from the regulators, and from the court.

Finally, the courts can only pronounce judgement on the matter or case presented to them. The case then did not involve the plight of the depositors and hence the court could not have taken decision on it. Hence, as the owners of the bank sued the CBN to protect their investment in the bank, the depositors too should be willing and ready to sue the CBN and the owners of Savannah Bank to recover their money.

To be continued

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