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Central Bank may sack staff

By on April 23, 2011

Lamido Sanusi, the CBN Governor has stated that some officials whose responsibility it was to raise the flag when things were going wrong in the banks cannot be absolved from blame for the crisis that eventually overwhelmed some banks.

Speaking at a workshop in Benin City, the Edo State capital, with the theme, ‘The Blueprint for banking reforms in Nigeria: Issues, Challenges and Prospects,’ Mr Sanusi said the CBN would not shield any officer that is found culpable. “If for instance, I have documentary evidence that junior officers had escalated warning signals across board and nothing was done, why should I sack the junior officer and if those who were supposed to have acted had already left the Central Bank, what do I do?”

He, however, said the outcome of an upcoming House of Representative public hearing on the failure of the banking industry may provide the right platform for the Central Bank to deal with its officials who refused to act at the proper time.

He said documents that would be submitted by the CBN, Nigeria Deposit Insurance Corporation, and Securities and Exchange Commission, would expose who did what before the crisis. “We will still look within the Central Bank and if there are people who ought to have seen things that they did not see, then there will be consequences,” he said.

Whistle blower

Mr Sanusi said even before he became governor, he had blown the whistle on the malfeasance of some of his colleagues, adding that the signals were clear even when he was chief risk officer at First Bank when many banks were taking depositors’ money and investing in markets that they did not understand. “I told everybody then that there was a problem in the banking system and the Central Bank was not facing the problem and that the system will explode in the faces of all of us,” he said.

“I told the governor then at the bankers’ committee that he had no business asking banks to restructure margin loans without providing for them and he was not happy.” He said his decision to delay reprimanding CBN officials who might be culpable of conniving with the bank was tactical. “I had to make sure the Central Bank was strong and secured before I fight.”

Quoting from Tze Tsu’s book, The Art of War, he said “If you are in battle, the ground on which you stand must be strong. There is no way you go into a war and light a fire under your own shoes.” Mr. Sanusi said his focus was on building a strong institution so that every official can take collective responsibility for decisions.

“Decisions and pronouncements that I make should not be seen as that of Sanusi but as the decision of the Central Bank based on what has flowed up from below,” he said. He said all the actions taken last year to arrest the banking crisis were based on the recommendation of the department of banking supervision. “They recommended that we removed the managing directors. But as the governor, I take responsibility for that decision. That is how institutions are built,” he said.

Source : 234next