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92 U.S. Banks Have Failed This Year - What's Sanusi's Problem?

http://money.cnn.com/2009/09/11/news/economy/bank_failure/

Ninety-two U.S. banks have failed so far this year, while the big names, e.g. Citi, are being propped up by government's money (through a long list of monetary instruments) to stabilize their economy.

Huge non-performing loans are hurting the US banks. Same in Europe. Nigeria is no different, except for our Crab Mentality (esctacy in pulling down people at the top), and other agendas.

For the records, I support criminal/civil prosecution of bank execs, if the law has been broken. However, it appears that naija bank chiefs got caught in a worldwide frenzy.

There were numerous options open for SLS to pursue in his commendable quest to strengthen the system; but he chose the most devastating to the system. Now, naija Letters of Credit (a capstone of international trade) are a piece of junk, and it is just the beginning of the bomerang.

Radicalism suits the Boko Haram enclave, not the CBN's Governor's office.

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24 answers

hi, you can find all US bank locations, addresses, telephone numbers and more details here. Check out the below link

US Bank Locations

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They are welcome to the club

Tell them!

Nigeria Is Blessed.

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I have observed with utter dismay the way Nigerians compare issues in Nigeria with US or Britain or other developed countries. It pains me. In the US or Britain, political office holders resign their appointments on mere allegation on default in handling official issues (even private matters). How many Nigerian citizens in position of authority have resigned even in the face of brazen misappropriation by him/her? In Asian countries, we have been reading about how ex-presidents of some of the countries are jailed/killed for corruption. How many Ex-presidents in Nigeria have been jailed despite monumental corruption discovered during and after their tenures?

In as much as academic intellectualism is accepted on this kind of forum, there is need for user of such knowledge to seriously give a thought to our perculiar situation before making comparisons. Leadership is more than mere classroom knowledge. I strongly feel Sanusi is right in his approach to tackling issues in the banking sector considering the rot there. Do you know how difficult it is to get a loan of N500,000 from a bank as an ordinary citizen, While another so-call eminent personality can access billions of Naira , even without due process? To make matters worse, the so-call important personalities are not servicing the debts and at the end of the day, the banks tighten the noose for the poor citizens to acquire loans. Are the so-call big wigs not supposed to respect themselves by following due process in giving out the loans and are the loans not supposed to be serviced as demanded by rule of law? Please, lets be realistic about our perculiar situation.

I know that no nation is an island unto itself but Nigeria is not US or Britain, and can never be. If Rule of law has failed woefully in Nigeria ( I don't need to explain this because it is obvious), is it gentleman agreement that will succeed? Please, at the level Nigeria is now, I support any level of high-handedness, if you call it so, that will bring sanity to the systems. Nigeria has to solve some problems in its own way.

So, let us see Nigeria as Nigeria and device our own way of solving our problems.

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The Risk Terrorists can't last 365 days as 'Cibilo'. Their works will work against them and their sins will find them out. They will soon quit and exile.

Back Fire now.

The Solution providers are worming up in all sectors

What is rilwanu doing in NNPC? Terrorising them?

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You live in the misguided belief that removing bank MDs one way or the other is the solution.

Helllllllooooooooooo!!!!!!!!!

The number of Bank MDs you sack is not a macro-economic index.

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@ JProspero

WORD and WELL SAID!!!!!!!!!!!!!!!!!!!!!!!!!!!

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All these faceless attacks on Sanusi and this creation of the impression that his action is terrible, tribalistic etc etc seem to make me think that it is just a campaign to make the guy look like a devil and get him out. I don't also want to believe that these guys bashing the man are relations of the bank MDs and borrowers who were arrested. You can say that the man could have acted in a different way to achieve the same result like telling the MDs to resign quietly. Do you know that many of these bank MDs would have tampered with documents before leaving if they had the opportunity?

Suddenly 87billion naira had been recovered after the Sanusi action. Intercontinental Bank MD (Akingbola) begged the President to help them recover their debts because it was clear to him that without his intervention, the debts were lost. Suddendly from the blues debtors of that same bank have paid over 20billion naira in about three weeks. That's about the amount you need to get a banking licence. If Savannah Bank and Societe Generale Bank had that amount of money, they would have opened for business.

Whichever way someone goes in Nigeria, he must be attacked. If Sanusi had allowed the banks to collapse, and depositors had lost all their savings, he would have been crucified for being a "useless Northerner" who could not manage something the "intelligent Soludo" worked on for 5 years.

I strongly believe that the bank MDs arrested need to be treated decently and assumed innocent until proved guilty, but the CBN Governor has the power to sack a bank MD if he thinks the MD has acted against the ethics of banking and has betrayed the trust of the depositors. Otunba Balogun of FCMB and and former Chairman (chairlady) of Citizens Bank were sacked some years ago and banned from holding positions in banking. It's not the first time this has happened in Nigeria.

If Yar'Adua could act decisively like Sanusi, we as Nigerians would be feeling proud wherever part of the world we are. So please let's stop all this bellyaching and face important issues.

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You mean with all the billion of Naira that has been sucked out of the banks, the banks are still very strong, and nothing could happen?

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For crying out loud, no bank was going under!!!!!!!1

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You talking like we talking about a nation that is civilized, we are talking about Nigeria where a lil thing will send shock waves into the system.

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In other parts of the world you get Experts, Economist, Auditors former Bankers talking about policies objectively most of the time

In Nigeria they seem to go underground allowing untrained reporters to give people information from the owners point of view

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maybe now people will stop that retartded belief that all whites are rich

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I want to correct an impression.

Why are we accepting Sanusi's propaganda that the five banks were failing? They had problems just like about every other bank both in Nigeria and the world over.Its not news that almost all the banks in the world had financial issues due to capital market (derivatives to be precise) and mortgage exposures.

If the banks were failing since October of 2008, how come all of them still had the capacity to fulfill their obligations towards their depositors?

10 months is enough time for a failing bank to collapse, but no they didn't.

Sanusi has the confidence and affontry to do what he did because we have an illiterate nation filled with people that think they are literate. A country where majority of the folks will celebrate any persecution as long as it is geared towards successful people.

The country is going to feel the impact of Sanusi's actions, but thinking of it. . . . . Nigerians deserve it. I feel sometimes like most Nigerians deserve this mess called Nigeria.

Thank you man for bringing this point out. The guy doesn't seem to have any strategy geared towards progressing the economy.

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Sanusi has caused so much damage to the Nigerian economy already.

Just thinking that the guy might be here for another five years is nightmarish

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@OP

http://www.nairaland.com/nigeria/topic-319752.0.html#msg4487748

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I think it would be unwise to make a direct comparison between the Financial sector in Nigeria to most western countries(not to talk of the USA ).

Most of these countries have a well grounded financial sector with strong asset base,good regulatory frameworks(although that is debatable in a lot of them),cohesive and consistent policies that make room for a vibrant business enviroment.The reverse is the case in Nigeria,apart form the usual uspects like chaotic macro-economic policies,acute corruption,insecurity,poor infrastructural base etc, the most relevant to this discussion is investor confidence.

The assertion that 92 banks in US have failed in the OPs arguement is quite misleading.A lot of those banks are equivalents of community banks in Nigeria.While their demise are noteworthy in terms of economic analysis ,they cannot be used in terms of justifying an opposition to Sanusi's actions.

With the global downturn,a very weak economy like Nigeria cannot afford to Kitty-Cat-foot around ,we dont have the time luxury that for eg the UK,US or Germany has.There is general concensus that in this economic age,Foreign Investments are crucial to the development of any developing nation of which Nigeria desperately needs to achieve its potential, Investors looks at the banks/financial sector in deciding whether to make FDIs or not.

I am fully aware that most policy intervention in Nigeria may have political undertones but on facevalue terms I would commend the CBN intervention .If we have a close look at this crisis Nigeria is one of the very few countries that have had the political fortitude to arrest bank executives and make them account for thier decisions,most countries have either pumped public money into banks to re-capitalise them or at best they let go of a few executives with millions of dollars in bonus( in some cases both have occured).

In contrast to the OPs position ,I think this would send a good signal to potential investors that Nigeria is re-positioning itself economically .

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Thank you, and thank you again for words well spoken written.

I might also add that the office is no place for Igbo/Yoruba/Hausa tribalists, Islamic religious idealist, or even a social messiah; it's an office that should support our monetary system to the letters.

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The economy is crashing

And I don't think any economy of the world will survive with Shake-ups every 5 years

All I think that was needed in this case was to put adequate lending frameworks in place, and bailout the failing banks if necessary with a mechanism put in place for repayment.

Running to the media and Sacking 5 Bank MDs in one day is not a Banking policy

And BTW those who shouted down the Banking consolidation years ago led by Atedo Peterside are at the vanguard of promoting the current Sanusi onslaught.

So this is not a case of people being resistant to change, this is just politics of 'who is up' and 'who is down' and I think the economy of 150 million people can not be used to engage in political tussles without putting into consideration the bigger picture.

This is why there must be due process, I PERSONALLY HOPE THE COURTS RE-INSTATE THE 5 BANK MDs.

Lest I forget, apart from sacking 5 MDs and dolling out 420billion has there been any change in the Banking process that led to the current bad loans? I doubt any framework has been put in place by the CBN.

None has been implemented nor announced.

Talking and acting tough is no replacement to good strategy.

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How was it made up?

They claimed to have invested money in the Capital Market and Oil and Gas industry. The Capital market crashed, oil prices dropped from their highs.

They claimed to be solvent but got the CBN Governor to start EDW to help them. The 5 banks accounted for 90% of the money borrowed from the EDW.

The banks started useless promotions like oceanic bank and the football draw that they were doing.

They quietly started firing worker on the basis that they could not meet target.

They claim investment was still coming into the country, when Africa as a continent saw the second largest withdrawal of FDI.

The IMF or World bank stated earlier this year that  banks had a huge amount of bad loans in their books, they and the CBN denied it. Now they are planning to make provisions for non performing loans.

One bank went on the pages of a newspaper and asked the president of the country to become their official debt collector.

All this are anti-consolidated forces?

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Im sure people said the same thing when Soludo started the consolidation process, seems new policies are always shouted down initially, its early days. . .

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The suspicions and controversy were all made-up by anti-consolidations forces

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Some of the CEO's of the big banks that were bailed out were asked to resign or resigned.

Most of the small banks are not going under becasue of bad loans, majority are going under becasue the big banks are refusing to lend to them. The small banks usually get money by borrowing form big banks or through the inter-rate market, and in the U.S the big banks are hoarding the money.

In Nigeria it is the same thing. The small banks could not borrow money from the inter market because the rate was too high. The rate was high becasue there was suspicion among the banks that some of them are relying too much on the EDW and without knowing who is who, the net putter of money in the inter rate market jacked up their interest rate. Banks like intercontinental and Oceanic had the asset to borrow at that high interest rate, but small banks will not have the assets to do that. So in a way he was not only helping the big 5 banks but stopping them from dragging the small banks along.

For Sanusi to fulfill his Northern Agenda, he should have let the banks failed, a depositor who has N1million (or any amount above N100,000) in the bank will only get back N100,000 (if the NDIC cannot sell the bank at a good price, that is what is guaranteed by NDIC), then auction of the assets of the banks for cheap to his Northern brothers to fulfil the Northern Agenda.

In a way that is what is happening in the U.S. instead of private equity companies buying a company when it is about to collapse, they come after the FDIC takes over and buy the bank's assets at an auction.

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Was it an urgent need to make a name for himself or it was done for the good of the country?Either way, Sanusi failed to look at the risk in taking such hasty decisions.Now that his lack of foresight have boomeranged ,who else will shoulder the burden and carry the disastrous effects ?NIGERIANS OF COURSE!

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