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Rain check for Lamido Sanusi

I’d seen Sanusi a number of times.  He was always the spectacular guy at many of First Bank’s cocktails.  Usually dressed in a fitted cream…

I’d seen Sanusi a number of times.  He was always the spectacular guy at many of First Bank’s cocktails.  Usually dressed in a fitted cream coloured suit and his ubiquitous bowtie, he meanders his streamlined frame among the crowd, interacting with all and sundry.  And it seemed everyone wanted to associate with him.  Sanusi is something of an enigma; the ‘buttered’ northern guy who is an ex-KC boy, well-spoken, smart and ready-to mix.  He has also acquired a hard-earned image as ‘Mr Risk’, having developed a reputation for himself as risk managers plenipotentiary.  Like me, he bravely and passionately wrote his articles on sundry issues even while still a banker; a risk manager being a risk taker!

The Senate session showed that Sanusi Lamido has a very sound idea of what the banking industry needs and he was articulate in his delivery and mannerism, but some of his responses drew my ire.  My hope hinges on the fact that he has a bit of time to learn, and to unlearn some of what he presently believes.  The crux of this article is therefore tailored at getting him to immediately unlearn; to disabuse his mind of some of the conceptions he is coming to the table with, from which he must be immediately exorcised!

Mr Sanusi, I humbly, but totally disagree with you on your take on interest rate regimes in Nigerian banks and the need for banks to keep a plethora of charges in order to do what?  Breakeven? No, that is not what banks do in Nigeria..  They keep all sorts of charges and add those to the normal interest rates on loans in order to pay themselves outlandish salaries which cannot be matched to productivity; in order to live flamboyant, Hollywood superstar lifestyles, and in order to continue to compete on the basis of who declares the largest profit and whose balance sheet is the fattest.  Please note that all that talk of ‘diesel purchase’ and power generators etc is essentially ‘wasted’.

I also vehemently disagree with you sir, on the issue of marketing/targets as presently structured in Nigeria.  My fear is that you may truly believe what you stated on the floor of the Senate (that targets are essential in any business and nothing much will or can be done about it by the CBN).  That is actually the kind of talk with which banks justify their total disconnect from society, and the culture of desperation which they have bequeathed to us all.  At that moment, I thought ‘Oh My God, I hope Sanusi has not been infested with the same virus that drive bankers crazy’.  It’s the Other-People’s-Money (OPM) Syndrome.  You rake in the money, you buy large cars, a private jet or two, and a fleet of yachts on Lagos Marina.  And then you start to strut around like you’re God’s gift to mankind.  Then in order to keep that lifestyle, you just devise all sorts of approaches to gyp hapless customers out of their money!

 It is totally reprehensible what is happening in our banking industry today, and something urgent must be done.  You are the man, Mr Risk.  You have the pedigree, the wherewithal, the determination, the hard-headedness, the opinionated-ness.  Like you rightly observed, this is the time to separate regulators from operators.  The dividing line had all but disappeared.   Banks have no right to continue damaging the fabrics of morality in this society, by turning all their staff into hustlers in the name of targets.  

In fact, we have just a few banks in Nigeria; the rest are BOILER ROOMS, who engage in pressure-selling useless and deceptive products to unknowing customers.  One of the BOILER ROOMS, who had a testy relationship with you personally, promises little girls and boys (barely youth corpers) the latest Honda Accord if they bring in N1billion.  What are we doing to our society?  Sorry I have absolutely no respect for these guys!!

They have no right whatsoever, to promote girls whose only ability is to con, tease or seduce money out of government officials, over and above honest strivers, who may not have yellow legs.  They should be held responsible for facilitating corruption and then turning around as individuals, to blame ‘Government’ for the abyss that Nigeria has found itself today.  Banks are central to EVERY major corruption scam in this country, as the ones who facilitate movement of money, many times deliberately.  Some even offer money-laundering products to government officials and openly encourage this stealing.

Dear Sir, the real problem with banks in Nigeria is their bizarre business models. They compete on the wrong indices, and input too much ego in the running of their affairs.  Nowhere, repeat NOWHERE else in the world are bankers as flamboyant as they are in Nigeria (as a result of their many charges), and yet Nigeria is actually about the 20th poorest country per capita in the World today – an inverse of what we hope to achieve.  There is no doubt that the faulted business model run by the banks is putting tremendous pressure, like our call tariffs, on the well-being of Nigerians.  In this year when banks around the world are declaring reduced profits and writing off huge losses, no Nigerian bank intends to slow down; rather they declare even huger profits and report fatter balance sheets, pay themselves stupendous salaries and then complain to us all about ‘generating sets’ and diesel, as if we don’t all power our businesses, and homes, in the same manner.  Heck, even local farmers provide their own infrastructure!  

This is the time to reduce further risk asset creation (which necessitates all these crazy target-setting in the first place), and appropriately manage over-bloated, inefficient and delinquent bank balance sheets.  This is the time to pay reasonable salaries (some banks pay new graduates up to N4million per annum, while Directors in the civil service, after 25 years of service to this nation, earn a total salary of less than N2million per annum).  The joke, as they say, is on this country. This is the time to return to conservatism.  Please end cowboy banking.

Sir, I take the liberty to write to you, knowing full well that you would have done the same if you were in my shoes.  I mirror your bravery, and I know that being a bank MD or CBN Governor will not make you discard your pan-Nigerian, nay Pan-African views of sustainable  development to which the CBN and its reporting banks are central.  Congratulations. Sir!

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