THE reform programmes to curb the banking industry malfeasance being managed and executed by the Central Bank of Nigeria (CBN) and Nigeria Deposit Insurance Corporation (NDIC) have reached a certain milestone. Through the instrumentality of Assets Management Corporation of Nigeria (AMCON), cooperating shareholders of distressed banks are now rescued into new acquisitions while others, who remain adamant, were left to their fate. In recent pronouncements and engagements, the regulators have reassured Nigerians that the crisis is over and that the industry is now sound. It is time therefore to seek full disclosure for the public to understand the terms and nature of the Nigerian commercial banking crises and their resolution. This transparency is important and due from the authorities. Nigerians should be given full information on the details of a harrowing programme that ran for 30 months and almost strangled the economy. A recurring mission of the Nigerian banking effort was the preference to 'rescue the depositors,' as was the case in similar reforms around the world. There exists, however, some grey areas and issues requiring urgent attention so as to clearly highlight accountability and culpability.Available reports show that both the CBN and AMCON have spent about N4.5trn to achieve the present resolution model. A breakdown of the somewhat inchoate figure, shows that the CBN 'spent N620bn to rescue the 10 banks at the initial stage in August 2009.' AMCON on its own has 'spent N1.725trn to acquire the non-performing loans from 21 banks.' Lately, another 'N736bn was injected into the three bridge banks to bring them to the capital and liquidity adequacy level required by the CBN.' It also injected N1.364trn in the remaining five rescued banks 'to bring them to a position of zero capital.'Outstanding questions include the fact that these banks are at the point in time, publicly quoted companies and not directly primed for public treasury funding. While we were informed that considerable dislocation had taken place in their operations, we need to ascertain to what extent due diligence is expended in the deployment of public funds. What is the truthful, verifiable amount of funds spent' Also, where it is touted that public funds were not on the table, what are the sources of this funding' In other words, whose money is this' Secondly, what is the opportunity cost of these funds' Thirdly, which agency monitors these funds in terms of accountability' Is there a structure in place to ensure prudent management and accountability of these funds' Does the National Assembly have a role to play in this area as part of its oversight functions' Above all, how satisfactorily have the regulators been able to stabilise the economy considering the new distortions that have now emerged' The CBN through its Deputy Governor for Finance Sector Stability, in his address at the 30th anniversary lecture and award ceremony organised by the Financial Institutions Training Centre (FITC), attempted an explanation of sources of funds for resolving the crisis. According to him, resolving the banking crisis has been at no cost to the public in the form of taxpayer's fund. He posited that the source of the money is from the Stabilisation Sinking Fund - Bank's contribution of 0.3 per cent of total assets of banks over the next 10 years, proceeds of bonds issued by AMCON and N50 billion contribution from CBN. In his words, AMCON and the banks are solely bearing the cost of stabilising the sector. He said Nigeria is the only country in the world where stimulus package was done without taxpayers' money, but through banks' contribution to the sinking fund and the AMCON. But questions have been raised as to the actual amount contributed by the banks, CBN and AMCON, vis-a-vis the trillions of naira already expended on the project. Then, there is the issue of the propriety of some of the other debts AMCON has written-off, as well as the legality of the sinking fund, its management and disposition of trustees of the funds. Are there no other profitable alternatives to which these funds should have been channelled' The sum of N4.5trn, if invested wisely by the regulatory bodies would impact positively on the current increasing unemployment level in the country, infrastructure decay and the perennial power supply problem. But this huge amount is being used to salvage the inefficiencies of the rich at the expense of the impoverished Nigerians who have been thrown out of jobs in the name of resolving the bank crisis. It ought to be made clear that the fund is not a gift. It should be paid back. Besides, with the recent assurance of financial soundness for the sector, does the fund continue to exist in the expectation of another crisis in the near future' It is inconceivable that the National Assembly, which has consistently embarked on an ego trip on such matters, is uninformed on this banking crisis resolution. It will need to sit up and consider its oversight functions, and perhaps, seek constitutional reforms to ensure that at no time would expenditure of trillions of Naira be made, or raised in the economy by paid public servants without specific legislative approval and safeguards. Also, where questionable debt write-offs have been made, the requisite agencies, including AMCON must be held to account for their action. A firm resolution of these outstanding issues will instil confidence not just in the banking sector, but the nation's economy as a whole.
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