The combination of One plus Two and Five – making eight
has significant implications amongst magicians, tarot card readers, fortune
tellers, snake charmers and Pentecostal preachers of prosperity, who insist
that it is supercharged with spiritual dimensions. Regardless, we must abandon
metaphysics and concentrate instead on heartily congratulating our nation’s
oldest bank on its 125th Anniversary.
It comes at a price – to remain silent or to rewind the
tape going back to its conception; impregnation; midwifery and deliverance at
the inaugural meeting of shareholders at the Colony Hotel, London in 1894.
It was not by pure happenstance that in attendance at
the birth was my grandfather, Dr. J. K. Randle. He did not need to wear his
surgical gown and gloves. He was there as an investor in pursuit of a grand
vision which would leapfrog in 1898 when according to the archives:
“As far back as 1898 Dr. John Kehinde Randle; Dr
Akinwande Savage; and Joseph Ephraim Casey Hayford (of the Gold Coast) the
founders of the National Congress of British West Africa had begun to agitate
for the independence of Nigeria, and the rest of West Africa.”
Hence, when the promoters of the Bank christened the
baby as “Bank of British West Africa” it was a profound confirmation that the Almighty
had divined a holy convergence of the respective interests of those who were
advocating independence for West Africa and the institutional promoters of the
introduction of banking as the lubricant for trade and finance in the region.
It was not lost on my grandfather and his colleagues
that their “Business Model” which was anchored on Health and Education as the
precursor to Independence, needed to be rejigged in order to include water,
sanitation, waste disposal and roads as the minimum contribution to the basic
needs for survival in a challenging region. They were not day dreaming. They
sought to replicate on the native soil of West Africa what they had witnessed
during their sojourn as students and professionals in Britain.
To put matters in context, perhaps we need to remind
ourselves that the Bank was midwifed at a time when all over Nigeria and the
rest of West Africa, the common currencies were cowrie shells which were
subsequently replaced by the manilla!! The only other alternative was trade by
barter or countertrade When the Bank opened for business at 35 Marina, Lagos
its next-door neighbour was none other than Dr. J. K Randle who lived in grand
style at number 31. There was no other building separating them as “33” was
considered unlucky by the soothsayers.
The history of the Bank became intricately intertwined
with the narrative of what preceded what we now call Nigeria and beyond – to
the rest of West Africa. It is the prerogative of the Bank to remind us of the
rapidity with which it firmly established itself as the banker to the colonial
government and the local/native/national entities that were sprouting all over
West Africa. As there was no Central Bank at that time in Nigeria or any of the
other British colonies in Gambia, Sierra Leone; or Gold Coast (Ghana), the Bank
was not only the banker to the government with responsibility for the
collection of taxes and duties as well as payment of salaries of civil
servants, it was also financing trade between the colonies and primarily Britain.
As we are not compelled or obliged to go into the nitty gritty, it is
sufficient to record that the colonies in West Africa exported raw materials –
cocoa, cotton, groundnuts, palm oil, rubber etc. to Britain in exchange for
finished goods. There is no evidence to provide confirmation that Nigeria
exported coal from Enugu to Newcastle in England!!
If we are somehow able to persuade the Bank to
surrender the keys to its vault and archives, we shall most certainly find
convincing evidence of gold bars (and silver) stored in the vaults when the
currency had to be backed with gold (in accordance with the “Gold Standard”).
The gold had to be checked first thing in the morning and at the end of the day
before the doors were shut. If there was any discrepancy, nobody could go
home!!
We leave it to the discretion of the Bank to avail us
of records of mundane matters such as the recruitment of staff from Britain and
“amongst the natives”. We can skip the delicate issue of salaries paid to
expatriates versus what was paid to local staff. Regardless, they worked
happily together towards the accomplishment of a common purpose.
We can take it for granted that the Bank kept
comprehensive records written with old style pen and ink in cursive – tellers,
mails, telegrams, ledgers, transfers of staff from one “station” to another,
disciplinary matters, and of course marriages as well as obituaries of staff.
It there were any financial or sexual scandals, the records were kept under
lock and key in the safe (with combination code) of the General Manager/ Chief
Executive of the Bank.
The current chairman of First Bank of Nigeria, Plc,
Mrs. Ibikun Awosika and the other ladies on the Board – Ms. Olusola Oworu and
Dr. (Mrs.) Ijeoma E. Jidenma are probably aware that right from its inception
the Bank discriminated massively against women. Now, it is payback time!!
To the best of my knowledge, the Bank did not recruit
any women from Britain to manage any of its branches in West Africa. This was
regardless of whether the women were single or married.
The role of women was confined to the category of
“accompanying spouse”. I stand to be corrected, but I believe that the first
woman to be appointed a manager was Mrs. Odedina (nee Agbaje). This was at a
time when her father Chief J. K. Agbaje was an Executive Director of the Bank.
In this regard, it would be unfair to single out the
Bank for chastisement. The policy was anchored on the belief/perception that
West Africa was a hardship area and the expatriate men were encouraged to leave
their wives and children behind in Britain while they strove to survive in the
heat. Their domestic lives were at the mercy of loyal cooks, stewards and
drivers. The delicate matter of mistresses will have to be consigned to later
chapters.
Perhaps we shall need to devote an entire chapter to
the snail’s progress of women who rose through the ranks before assuming higher
responsibilities at the levels of manager, Executive Management, or Non –
Executive Director. So far there has been no female Chief Executive of the
Bank!! When Mrs. Bola Adesola and Mrs. Remi Odunlami were appointed as
Executive Directors, there was intense speculation that one of them might make
it to the top as the Managing Director/Chief Executive of the Bank. Alas, it
did not happen. I am however obliged to confess that I am not an entirely
unbiased umpire in the matter as Bola (nee Lardner) is the great – grand
daughter of Dr. J. K. Randle. She may not have disclosed this to the Bank. Her
later father Mr. Harry Afolabi Lardner SAN, who was a brilliant lawyer was my
first cousin as well as the executor of the Estate of Dr. J.K. Randle.
Regardless, we must give kudos to the Bank for the zeal
and commitment it devoted to what we now label as “financial inclusion”. Its
long reach and vast network which covered the nooks and crannies of Nigeria and
other parts of British West Africa was as extensive as it was formidable.
Even missionaries, soldiers and policemen in far flung
places were within the radar of the Bank which ensured that their stipends (for
missionaries), salaries, travelling allowance and other benefits were promptly
paid.
For those who are anxious to avail themselves of a
concise bio-data or testimonial of the Bank, both the website and the
indefatigable Alex Otti (a former Executive Director) have conspired to deliver
the following powerful advertisement:
 |
| J K Randle |
“The bank began as the Bank of British West Africa
(BBWA) in 1894 and quickly began playing the role of the Central Bank of
British West Africa in the absence of a regulator at those medieval times in
the sub region. The bank witnessed the amalgamation of the Northern and
Southern protectorates and the eventual independence of Nigeria in 1960. It was
founded by Alfred Lewis Jones, a shipping magnate who imported silver currency
into West Africa through Elder Dempster shipping company also owned by him.
In 1957, the bank changed its name to Bank
of West Africa (BWA). Sequel to Nigeria’s independence in 1960, the bank began
to extend more credit to indigenous Nigerians as most of its credit facilities
were hitherto concentrated on foreigners living in the erstwhile colony.
Standard Bank acquired the Bank of West
Africa in 1966 and changed its name to Standard Bank of West Africa. In 1969,
Standard Bank of West Africa incorporated its Nigerian operations and its name
had to change once again, this time to Standard Bank of Nigeria Ltd (SBN). In
1971, SBN listed its shares on the Nigerian Stock Exchange and placed 13% of
its share capital with Nigerian investors. Following the implementation of the
indigenisation policy of the then military government soon after the civil war,
Standard Chartered Bank reduced its stake in SBN to 38%. This action led to
another change in name to First Bank of Nigeria in 1979 as Standard Chartered
Bank insisted that since it had lost majority control, the bank should no
longer bear its name since by the action, it had failed to be its full-fledged
subsidiary.
In 1982, First Bank opened a branch in
London and converted same to a full-fledged subsidiary, FBN Bank (UK) in 2002.
Two years later, in 2004, a representative office in Johannesburg, South
Africa, debuted. At the moment, First Bank has subsidiaries or representative
offices in France, China, Democratic Republic of Congo, Gambia, Sierra Leone,
Ghana, Guinea and Senegal. At the last count, First Bank had presence across 10
countries in three continents. It operates from over 750 locations and employs
close to 22,000 people. Its has over N3.3trillion in total assets. It also
boasts over N2.5trillion in Customer deposits with a tidy 19% Capital Adequacy
Ratio (CAR). The bank has over 1.3m shareholders and over 14million customers.”
For those who have attempted to fault the Bank’s
assertion:“Banking for Good.” The least we can do is to remind them that the Bank
spread the gospel of banking through missionaries, traders, “Mercantile
Houses”, such as the United Africa Company (UAC); Lever Brothers; United
Trading Company (UTC); Leventis Stores; G.B. Ollivant; Paterson and Zochonis
(PZ); Mandillas; CFAO etc.The traders were mostly Lebanese, Syrians, Jews;
Greeks and of course, British and French. At various times, the Bank was
confronted with trenchant complaints that it discriminated against our
fledgling entrepreneurs when it came to granting loans in order to assist them
in their business pursuits. The bank had a ready self-fulfilling excuse – the
“natives” had poor business experience and no collateral.
However, we cannot overlook the fact that while the
British managers had what was termed “Terms and Conditions of Service”, the
“natives” had none!! It was not until much later that pressure from the Labour
Union and the government resolved such glaring cases of discrimination. There
was also the delicate matter of segregation. While the white managers lived in
exclusive “Government Reservation Areas” (“GRAs”), the natives had to fend for
themselves.
Say what you will about the Bank, it is to its credit
that at intervals it would select some of the local staff and send them off to
the United Kingdom for training or posting, for short periods in
order to prepare them for promotion into the management
cadre.
One of the earliest beneficiaries was Chief Julius
Kosebinu Agbaje who was entrusted with the Bank’s public relations. He
facilitated the recruitment of quite a large number of ex-students of St.
Gregory’s College, Lagos (his Alma Mater) and many of his protégés served the
Bank meritoriously.
Somewhere along the line, the Bank switched its
recruitment policy almost exclusively in favour of graduates, who after brief
training, entered the management cadre. Inevitably, there was tension and
conflict as well as envy as those who were stuck in the rank and file resented
the new bunch of managers and bosses whose banking skills were somewhat
rudimentary. Regardless, the graduates were rewarded with generous salaries
along with cars and accommodation allowances.
Quite a few of them gained rapid promotion as well as
the much-coveted overseas training. We are obliged to acknowledge that the Bank
was very much part and parcel of the British colonial government which had
tentacles all over what would become Nigeria in 1914. Separately, we shall
resolve the mystery behind the choice of the dour elephant as the dominant
feature of its logo rather than the nimbler and more sure-footed leopard.
Incidentally, in 1912, a leopard with its spots et all was shot dead right in
front of the Bank’s office at 35 Marina, Lagos. The photograph has been
preserved for posterity under the caption:
“Colonialists And Some Nigerians Watch The
Remains Of A Leopard Shot Dead In Lagos in 1912.”
It goes without saying that the British managers of the
Bank had easy access to the colonial administrators from the rank of District
officers to Lieutenant-Governor and Governor/Governor-General. They belonged to
the same exclusive social clubs e.g. Ikoyi Club (which was previously known as
the European Club); and enjoyed special medical facilities e.g. “European
Hospital” (now Military Hospital) while the General Hospital was for “the
natives”.
All over Nigeria, the Bank worked the same hours as the
colonial government officials.
Government offices and banks would open on the dot of 8
o’clock in the morning and close at 3p.m. which left plenty of time for lunch
and siesta followed by golf, tennis, squash racquets or billiards at the club.
Cocktails and dinner either at club or at each other’s
homes were regular features of the day and night. At the weekends, cricket,
beach parties/picnics, boating, fishing, swimming and horse riding were
generally available for the expatriates.
As for “the natives”, they had to make do with whatever
leisure activities they could rustle up by relying on their ingenuity. Entrance
to the exclusive clubs and residences of the expatriates was only through the
back door or the kitchens. The only leveller was the scourge of malaria and
diarrhoea which ravaged West Africa with vicious frequency. It provided the
colonial officers and
British bank managers with a ready excuse for the
consumption of large quantities of gin and tonic, with whiskey and soda as the
alternative to be chased with brandy and cigars. Champagne came much later.
As if to ape their colonial masters and British bank
managers, “the natives” took to smoking cigarettes and pipes stacked with
imported (or local) tobacco. In addition, they made do with beer and football.
Even in the Churches, the front row was reserved for
the colonial government officers and British bank managers. Right here in
Lagos, the Church that was within shouting distance of King’s College was
“christened” the Colonial Church (European Church) and it was exclusive for
prayers to the Almighty by Europeans. Thankfully it is now known as St.
Saviours Church.
It would be unfair to heap the blame on white officers
of the Bank who only swam with the tide.
In any case, it is too late to demand reparation.
Instead, we should focus on the three critical areas
that circumscribed the matrix of the Bank and galvanized its strategic thrust
into the fabric of its society:
1. People
2. Customers and
3. Culture
Rather than conclude that, that it is “The Heart of The
Matter” going by Graham Greene’s experience in Freetown, we should rely instead
on Peter Drucker’s declaration:
“Culture eats strategy for breakfast.”
In order to put matters in context, it is of utmost
importance to appreciate that one hundred and twenty – five years is a really
long stretch. In the Netherlands, any organisation that has lasted one hundred
years is automatically conferred with the honorary title “Koninklijke” or
“Royal” which it may apply to its name. A case in point is Royal Dutch Shell.
Other examples are Feadship Royal Dutch Shipyards, Koninklijke Luchtvaart
Maatschappij [KLM] or translated – Royal Dutch Airlines.
Also, we must not forget that 1894 to 2019 straddled
two World Wars from 1914 to 1918 and 1939 to 1945. It says much for the
resilience of the Bank of British West Africa in war and peace, that it
maintained its duty of care to its people (staff), customers and culture. In
the event of a Third World War, the Bank has its template for survival ready.
There would be no need for underground bunkers or tunnels.
It is to the credit of the Bank that it kept meticulous
records of its staff who perished during the wars that had little to do with
banking. Without oversimplifying matters, the temptation to shift our focus on
how the Bank survived the spate of bank failures and financial
meltdown/economic disasters is overwhelming.
Perhaps it was the formidable combination of people,
customers and culture that provided the robust defence wall, safety net,
survival moat and ballads.
Within the expatriate community, every now and again,
there were rumours of wife swapping and husbands snatching. Sometimes, the
predators were the bankers while the colonial government officials were the
victims.
However, more often than not it was vice versa (the
other way around). We shall have to dig the records of the Bank in order to
extract how such delicate matters were dealt with.
However, what was well known is that some of the
bankers strayed into forbidden territory to sample the “local content” and
ended up fathering babies. Nine months later the half – caste son and daughter
would emerge leaving little doubt as to who the father was considering that
there were only one or two white people in vicinity. For some reason, the
“native women” of Calabar, Sapele, Warri, Jos and Kaduna who had a reputation
for being sultry, seductive and willing were fair game.
However, brazen cases of financial misconduct, violent
behaviour, mental instability or outright insubordination by managers of Bank
of British West Africa would leave the Bank with no option other than to
swiftly book a passage back to England on the next available ship for the
offender.
In order to properly appreciate the formidable role the
Bank played in enquiring financial inclusion (for the right reasons),
management of the fledging economy, transparency andaccountability, perhaps we
should take a snapshot of how matters stand today:
1) Front page of “The Nation” newspaper of March 28,
2019
“WITNESS: I GOT N769.5 MILLION FROM EX –
NDDC CHIEF FOR NO CONTRACT”
“A Software developer, Eyo Bassey Francis,
yesterday told the Federal High Court in Lagos that he received N769.5 million
from Niger Delta Development Commission (NDDC) Executive Director of Projects,
Mr Tuoyo Omatsuli, for no specific job done.
Francis, the first prosecution witness in
Omatsuli’s money laundering trial, said the huge sum was not for any particular
contract. He said he came in contract with Omatsuli in 2014 and told him that
he ran an online platform, did a lot of imports and was able to souce for
foreign currencies.
“He later called me on phone and told me
that some money will be transferred to my account.
“I got initial sum of N80 million
transferred into the Heritage Bank account of one of my companies, Asiladrrin
Global Consulting Ltd.
“When the money was paid I converted it to
dollars as directed by the first defendant (Omatsuli),”
Francis said.
The witness said N340 million was also paid
into his firm’s account in two traches of N160 million and N180 million on
Omatsuli’s instruction. He said he also converted the money, which he said came
from Starline Consultancy Services Ltd, into dollars and disbursed it as
directed by Omatsuli.
“Sometimes in January 2015, I also got a
call from the first defendant telling me that I will be getting a payment from
a company known as Building Associates.
“I later got an inflow of N349, 650, 000
into Heritage Bank account of my company, College – Pro Synergy Ltd.
“I was furnished with an account of a firm,
Greenhouse Investment, owned by the Special Assistant on Finance to the then
NDDC’s MD to which I transferred N100 million.
“The balance was converted to dollars as
directed by Mr. Tuoyo,” the witness said.
Asked by prosecuting counsel Mr Ekene Iheanacho
if he executed any contracts for the companies from which funds were
transferred to him, he said: I never had any contract with Starline Consultancy
Services Ltd or business relationship with it.
“I never had any contract with Building
Associates.”
Under cross-examination by Omatsuli’s
lawyer Prof Amuda Kehinde (SAN), the witness said he did not transfer any money
to the first defendant’s account.
“I don’t have any documents on the
instructions the first defendant gave me,” he said.
Francis said he did not know what the money
sent to his accounts was meant to used for.
The Economic and Financial Crimes
Commission (EFCC) arraigned Omatsuli for allegedly receiving N3.6 billion bribe
from a contractor, Starline Consultancy Services.
He was charged with Don Parker Properties
Limited, Francis Momoh and Building Associates Limited before Justice Saliu
Saidu on 45 counts.
EFCC said Omatsuli procured Momoh and
Building Associates to utilise a total sum of N3.6 billion paid by Starline
Consultancy Services.
It accused Omatsuli of conspiring with the
others “to disguise the illegal origin of N3,645,000,000, being proceeds of an
unlawful activity, to wit: corruption and gratification.”
The alleged offence, which EFCC said was
committed between August 2014 and September 2015, contravened Sections 15 (1),
15 (2), 15 (3) and 18 of the Money Laundering Prohibition Act 2011, as amended
by Act No 1 of 2012.
The defendants pleaded not guilty.
Justice Saliu Saidu adjourned until April
11, 2019 for continuation of trial.”
2) Front page of “Daily Sun” newspaper of March 28,
2019
Headline: (From the archives) “IG OF POLICE
TAFA BALOGUN ARRESTED”
“On this day in March 2005, a former
Inspector General of Police Tafa Balogun was arrested for money laundering
Mustafa Adebayo Balogun became IGP in March 2002, replacing Musiliu Smith.
He was responsible for overall police
security during the April 2003 national elections, which were marred by reports
of police abuses. In August 2003, Tafa Balogun presented a paper on
"Nigeria:
Electoral Violence and National
Security" in which he advocated improvements such as use of national
identity cards, mass education, electoral law reforms, citizens participation
in politics, good governance and establishment of a constitutional court.
In December 2003, Tafa Balogun organised
extensive security measures across Nigeria to ensure that there were no
disturbances during the Commonwealth of Nations summit. Following various
incidents in 2004 where reporters were beaten and their equipment damaged by
policemen, Tafa Balogun made apologies and promised that those responsible
would be punished Towards the end of 2004, newspapers
published allegations of corruption on a massive scale, asserting that Tafa
Balogun had pocketed public money and bribes from politicians and criminals.
These led to his forced retirement in January 2005.
On 4 April 2005, Tafa Balogun was arraigned
at the Federal High Court, Abuja on charges involving about N13 billion
obtained through money laundering, theft and other sources. TheEconomic and
Financial Crimes Commission under Nuhu Ribadu brought 70 charges against Tafa
Balogun covering the period from 2002 to 2004.
He allegedly made a plea bargain with the
court in exchange for returning much of the property and money. He was
sentenced to six months in jail. He was released on 9 February 2006 after
serving his sentence, part of it in Abuja National Hospital. In November 2008
and again in February 2009, the Chairman of the House Committee on Police
Affairs, Abdul Ahmed Ningi, asked the Inspector General of Police Mike Okiro,
to provide details of the money recovered from Tafa Balogun, a request that he
passed on to the EFCC chairman, Mrs. Farida Waziri.
However, the EFCC stated that they did not
have records of the exact properties recovered from Balogun. It was said that
some of the houses had been secretly sold to certain individuals at giveaway
prices. In April 2009, the House of Representatives Committee on Police Affair
invited Tafa Balogun, Mike Okiro and Mrs. Farida Waziri to explain how the N16
billion allegedly recovered from Balogun got missing.
3) Front page headline of “Daily Sun” newspaper of
March 27, 2019
“NIGERIA BROKE-GROUP SAYS 2019 BUDGET DEAD
ON ARRIVAL.”
“Centre for Social Justice, a Nigerian
knowledge-based institute, yesterday, declared that Nigeria is broke and that
the 2019 budget was dead on arrival.
While justifying this claim, the Lead
Director of the centre, Mr. Eze Onyekpere, noted that the budget deficit is at
1.33 per cent of the Gross Domestic Product (GDP) and the economic
diversification, which would have been a source of revenue, is not effective.
Speaking with newsmen in Abuja, Tuesday,
Onyekpere said the deficit is in the sum of N1.859 trillion, or 21.06 per cent
of the overall expenditure and 26.68 per cent of the retained revenue.
“It is to be financed mainly by borrowing
the sum of N1.649 trillion from external and domestic sources – N824,82 billion
from each source,” he said.
This, he said, leaves a balance of N210
billion to be funded from privatisation proceeds, adding, however, that it is
an expectancy which is yet to materialise.
“From the experience of the 2016, 2017 and
2018 budget implementation, the president and National Assembly need to start
the approval and implementation of the borrowing process early so that funds
can be available to execute the proposed 2019 capital budget when approved,” he
advised.
According to him, notwithstanding the
mantra of economic diversification, the nation is still faced with the
dominance of oil as the single most important revenue source. This implies that
the diversification efforts have not yielded the desired dividends.
“The efforts need to be intensified for
non-oil revenue to gain ascendancy. At 52.94 per cent of expected revenue, oil
is still the dominant factor. However, Nigeria is yet to fully explore, exploit
and expound the frontiers of oil-based revenue through income from refineries,
petrochemical complexes and the full value chain of the sector. Thus, while
diversifying, we need to fully explore the potential of the sector,” he said.”
If the Bank should ever contemplate a change of name,
the obvious choice is ENDURANCE BANK!! Truly, over the last one hundred and
twenty – five years, it has been battered and assaulted by the turbulence of
its volatile environment – both political and economic as well as the social
tapestry and lattice of governance. Regardless, the Bank has emerged as a
national treasure with regional tentacles and global foot prints.
At its birth in 1894, the Bank shared its page in
history with launching of the Hong Kong Jockey Club which is still flourishing
even after the handing over of Hong Kong ( Harbour) to China
by Britain.
Other epochal events of that vintage to mind:
• Long before “Rural Banking” infiltrated the praxis
and lexicon of banking, the Bank was already firmly planted in our rural areas
– particularly where the commodities for export to Britain were ready for
evacuation. Consequently, those who extracted tin from alluvial mining, the
cocoa farmers, palm oil tappers, rubber plantain owners etc. were on the radar,
if not directly at least through agents and middle men who assured them that
payment would be effected promptly by the Bank. The ruggedness of the Bank must
have been put to test during the First World War (1914 - 1918) and again
between 1939 and 1945 while the Second World War raged.
Inevitably the Bank
hooked its wagon to the British train and adopted strategies which left nobody
in doubt about its allegiance to Britain. It is also instructive that the
Bank’s spunk and grit were very much on display as our nation went through
numerous coup d’états and putsches starting on 15th January 1966 followed in
rapid succession by the revenge coup of July 29 1966 and spiralling into Civil
War (1967 to 1970). Regardless of the turmoil, the Bank for the most part kept
its door open with due caution for the safety of lives and cash. It must have
been a monumental task and agonizing judgment call. Perhaps when we delve into
the archives of the Bank, we shall retrieve records of how it handled some of
the most epochal events in our nation’s financial landscape and economic
history such as:
• The Goschalk award
• Adebo Award
• Udoji Award
We may also be pleasantly surprised when we discover
(or uncover) the discreet role played by the Bank in elections all over the
country starting with the first one in 1923 right up to the most recent one
regardless of the alarming report and lament by Edwin Enabo, INEC (Independent
National Electoral Commission) Head of Department of Voters Education and
Publicity in Rivers
State:
“The INEC office is under siege by men in
army uniforms, uniforms of the Air Force and police who have taken over.
They are stopping and screening people.
They are clearing results before they enter
the office to the extent that up till now no collation has been done.
We don’t understand where the people are
deployed from.
We are not accusing the Nigerian Army or
the Nigerian Air Force, but we say the people right now in the office are
wearing uniforms of Army and Air Force.
If they are not from them, we are calling
on them to come and rectify the situation and allow our officers to enter with
their results without molestation and harassment.
Throughout the elections, we had so many
reports of insecurity, molestation, harassment and assault on our staff and
ad-hoc staff, disruption of the electoral process throughout the state in all
the Local Government Areas with the consequence that by yesterday evening we
were unable to get any results and by 1 pm today, the office is under siege by
men in Army, Air Force, and Police Uniforms.”
The Bank readily availed the government and the
election authorities of its advice, observations and support in terms of its
trusted officials combined with logistics and communication facilities.
In similar fashion the trust and reputation of the Bank
extended to other sensitive matters such as the examination papers of the West
African School Certificate; Higher School Certificate and
the professional examinations of the Chartered
Institute of Bankers of Nigeria and Institute of Chartered Accountants of
Nigeria [ICAN] whereby the examination papers would be sent inadvance in sealed
envelopes to the branches of the Bank closest to the examination centres with
strict instructions that the envelopes should only be opened at the examination
centres. There is no record of failure to exercise due care on the part of the
Bank.
Perhaps this is an appropriate function at which to
savour the list of the Chairmen of the Bank from inception to date:
Also, relevant is the list of its Chief Executive
Officers:
Clearly, following the Nigerianisation of the Bank, no
ethnicity can claim that it is its exclusive preserve or turf for the pursuit
of primordial interest.
Also, considering the role the Bank has played behind
the scenes in defining not only the ethics of banking but also the ethos of
professionalism as well as the delicate matter of endemic corruption and its
consequences, the least we can do is to line up behind Transparency
International and the recent publication of:
NIGERIA’S CORRUPTION PERCEPTION INDEX
(1996–2018)
Thankfully, Nigerian-born World Heavyweight Boxing
Champion, Anthony Joshua has gone viral and lyrical:
“There has always been a big piece of my
heart as a Nigerian and I do believe that it is that piece that sets me apart.
It always says to me, “never give up, dream big!” We come from a nation of
warriors....we have that same tenacity, that Nigeria fighting spirit that makes
us game changers! We are relentless.
We don’t just face our challenges, we step
into the ring to win again and again. If you believe in yourself there is no
limit to what you can achieve.”
Undoubtedly, First Bank of Nigeria subscribes to the
same article of faith.
For those who are tempted to conclude that one hundred
and twenty-five years is more than enough to enable the Bank to instil
financial discipline and robust prudence in our nation, the
front page of “Business A.M.” newspaper of March 25,
2019 has delivered a severe jolt.
Headline: “MOUNTING CLIFF–HANGER DEBT SHOWS
NIGERIA’S GONE
BROKE”
“As the Federal Government’s borrowing in
the last three and a half years has progressively doubled Nigeria’s stock of
public debt (both domestic and external), there are palpable fears in fiscal
and monetary policy analysts’ circle that the country could soon really become
broke and be unable to meet its obligations. Fears have also been expressed
that the nation may become stuck in a debt quagmire in the event of a major
currency crisis or face foreign exchange risks that could double the current
debt
profile.
Nigeria’s debt profile, according to the
Debt Management Office (DMO), stood at $73 billion (N22 trillion) at the end of
June 2018 compared to $63 billion in June 2015. According to debt statistics
obtained from the DMO, the country’s
external debt rose from $10.32 billion in June 30, 2015 to $22.08 billion as of
June 30, 2018.
This means that the country’s external debt
commitment has grown by 114.05 percent in the last three and a half years.
Although multilateral debt made up $10.88
billion or 49.28 percent of the country’s external debt profile, most of the
increases in the last three years occurred in the area of commercial loans.
According to the DMO, commercial foreign
loans, which stood at $1.5 billion as of June 30, 2015, had risen to $8.8
billion as of June 30 2018.
This means that in the last three years,
the country’s exposure to commercial foreign loans has risen by $7.3 billion or
486.67 per cent.
Oil revenue appears to be the only certain
source of revenue that is constant. But despite government promises to beef up
non-oil revenues, they have remained elusive.
Even as revenue has declined, government
spending has skyrocketed, growing by 56 percent since 2012 and as much as 26
percent between 2016 and 2017 alone, one analyst told business a.m., adding
that it was a worrying position to be right now for the country.
The country’s spending has not been
particularly efficient either, noted another analyst who would rather not be
named, but said he was speaking to draw the attention of policy makers to the
danger that lies ahead, if nothing was done quickly now that elections are
over.
“Nigeria spends more on salaries and
servicing debt than on capital projects – even in 2017 when capital expenditure
was at a record high,” he said, suggesting unproductive expenditure
concentration.
“Personnel costs haven’t changed much in
recent years,” said a policy analyst, adding that this was despite government
promises. “They even consume a greater share of what the government earns. In
2013, half of what the government earned was committed to salaries; by 2017,
that number was 70 percent,” he said, describing it as most inefficient and
unproductive use of falling earnings of government. “And of course, as global
crude oil prices rise, Nigeria spends more and more on wasteful fuel
subsidies,” he pointed to a much-vexed issue that has been widely condemned by
very many in business and policy corridors, except those who tap political
capital and other benefits from the system.
Analysing the scenario further, he said: “It
is important to note here that the Nigerian government doesn’t spend that much
compared to its peers. Federal government spending was just 5.6 percent of GDP
in 2017, compared to 13.4 percent and 20.9 percent in Angola and South Africa
respectively, according to the World Bank. The issue is that the government
doesn’t earn much money, meaning that even the little spending that is done
seems reckless.”
Indeed, financial experts at the
International Monetary Fund and the World Bank have advised that the revenue-to-debt
ratio is unsustainable and it portends a serious danger for future generations
of Nigerians.
The disturbing public debt situation has
drawn concern from various groups and bodies in the country who see the trend
as a danger to the nation’s sovereignty.
Timothy Olawale, director general of the
Nigeria Employers’ Consultative Assembly (NECA) described the trend as very
disturbing, which could have a negative effect on the developmental capacity of
Nigeria.
Tajudeen Yusuf, a member of the House of
Representatives who brought the issue up for discussion at plenary, noted that
the House was concerned that aside from the rising national debt profile, there
was a sharp increase in sub-national borrowing in the last three years, such
that the domestic debts of state governments rose from N1.69 trillion in June
2015 to N3.4 trillion in June 2018.
He noted that though external or domestic
borrowing was an important and necessary strategy to reflate the economy and stimulate
national growth and development, “the positive impact of Nigeria’s borrowings
since June 2015 has yet to be seen.”
Tajudeen added, “Unlike global practices
where borrowings are tied to specific projects mutually agreed by respective
organs of the government, various borrowings by the federal government since
June 2015 have not been transparent, a situation which gives room for doubts,
misconception and prone to manipulations.
“Nigeria’s revenues are sharply declining,
which makes it increasingly difficult to attract and sustain higher debts,
ultimately portend micro and macro dangers to the national economy amidst
numerous developmental challenges,” he noted.
Nigeria has in recent times used the
Eurobond market for its external funding, rather than concessional lenders. It
sold $5.4 billion of bonds last year and $4.8 billion in 2017, making it
Africa’s most prolific
issuer in that period after Egypt. Bank of
America said in a research note this month that Nigeria would probably print
another $3 billion of securities in the second half of 2019.Patience Oniha,
director general of the DMO, while speaking on the high cost of servicing the
public debt, said: “If you were to ask me if we’re going to issue Eurobonds
this year, I’d say we’ll explore all the options.
“Our preferred option is to explore
concessional sources. One of our major objectives is to reduce debt service
costs,” she said.
Out of the N8.9 trillion proposed national
budget before the parliament for approval, over N2.3 trillion has been set aside
for debt servicing, a development economists said was unhealthy for national
development and economic growth.”
The founding fathers of Bank For British West Africa
deserve kudos for forging ahead regardless of the mischievous scheming and
cynical tunnel vision of Lord Macaulay as conveyed in his address to the
British Parliament on 2nd February 1835:
“I have travelled across the length and
breadth of Africa and I have not seen one person who is a beggar, who is a
thief. Such wealth I have seen in this country (sic), such high moral values,
people of such calibre, that I do not think we would ever conquer this country
(sic), unless we break the very backbone of this nation (sic), which is her
spiritual and cultural heritage and therefore, I propose that we replace her
old and ancient education system, her culture, for if the Africans think that
all that is foreign and English is good and greater than their own, they will
lose their self-esteem, their native culture and they will become what we want
them (to be) – a truly dominated nation (sic).”
What was most remarkable about the Bank is that right
from its inception, the managers were close to the powers that be – from the
colonial administrators to kings, emirs, politicians etc. but they were careful
to draw the boundary in order not to appear to be rivals (or contenders) of the
power brokers.
They were also adept at managing crisis or dislocation.
A case in point is the Civil War that engulfed Nigeria from 1967 to 1970. Igbo
officers of the Bank who were trapped in the North and the South-West
(particularly Lagos) fled in droves to the East and sought the assistance of
the Bank for survival.
How the Bank coped with the tragedy of closing its in
branches in Biafra while dealing with refugees is a matter for another book.
Even more challenging was the enormous burden which the Bank had to shoulder as
it strove to resuscitate its abandoned branches and rehabilitate Igbo
managers/staff who had lost everything on account of the war as well as the
change of the Nigerian currency which left them mostly destitute, homeless and
helpless.
The Bank of British West Africa evidently maintained a
professional relationship with the colonial government and its civil servants.
Fortunately, the Civil Servants were obliged to adhere to the Code of Conduct
which was enshrined in the “GO” (General Orders) and “FI” (Financial
Instructions). Consequently, the system provided a formidable bulwark against
what we are now witnessing on a regular basis whereby corruption has run riot
with reckless abandon combined with nauseating impunity.
The following report has gone viral:
“HOW NIGERIAN GOVT OFFICIALS RE-LOOTED
‘NEARLY $900M’ OF ABACHA
LOOT THROUGH JP MORGAN CHASE”
Details have emerged of how Nigerian
government officials extracted from funds looted during the regime of late
General Sani Abacha, through JPMorgan Chase, an American multinational
investment bank and financial services company headquartered in New York.
Nigerian government has, however, filed
charges against the bank for working with the said government officials to
“extract nearly $900 million between 2011 and 2013 from a government bank
account in London”, according to a report by New York Times.
The $900 million is part of the billions of
dollars looted by government officials during the regime of the late General
Sani Abacha.
A report by New York Times, a version of
which was published in print on April 1, 2019, noted that the case has been
filed before a court in Britain although JPMorgan Chase has insisted that the
withdrawal of the money followed instructions by certain “senior government
officials” from Nigeria.
This is in spite of the refusal of the two
banks, to which the money was wired, to accept the transfers over concerns
bordering on violation of money laundering laws.
Another major source of concern is why
JPMorgan Chase went ahead to approve the release of the funds, despite the
issues it had with the request, which it reported to financial regulators.
However, in spite of its suspicion that the request for extraction could have
come from the basis of money laundering, it went ahead to make the transfers.
As a result, the Nigerian government is now
requesting the court to compel the bank to pay up in
damages. JPMorgan Chase has countered the
suit with its own court documents, basing its position on the fact that the
agreement signed between both parties was also subject to following
instructions of the Nigerian government even if the bank had its misgivings
that the transactions “were not in the best interest” of the former.
However, the back-and-forth on the funds
did not begin in 2019. Flash back 20 years ago, specifically in 1998, Sani
Abacha had awarded an oil licence to Dan Etete, Nigeria’s oil minister at the
time for $2million. However, the transaction was projected to yield billions of
dollars in revenue, and there were unsuccessful attempts by the successive
government to revoke the licence on the grounds of corruption.
Fast-forward to 2007, asides being
convicted of money laundering in France in an unrelated case, a deal was struck
involving Etete, the Nigerian government and two oil companies, Royal Dutch
Shell and Eni for sale of the licence. However, Etete and friends of former
President Goodluck Jonathan were said to have benefitted more than $1billion in
the deal and the case is currently on trial in Italy.
In February 2018, Bayo Ojo (SAN), a former
Attorney General and Minister of Justice, had admitted to the court that he
received a “compensation” of $10million from Etete for his work as a legal
adviser during the sale of OPL 245.
An account was opened by the Nigerian government
officials with JPMorgan in London, and a subsidiary of Eni deposited about
$1.1billion on May 25, 2011, of which a transfer-request to the Banca Svizzera
Italiana, a Swiss Bank, was made. However, the Swiss bank rejected the transfer request on the grounds of that it suspected
that the funds would eventually find its way to Etete. These were presented in
the documents made available to the Italian court. With the situation on
ground, JPMorgan Chase also expressed reservations on the funds to financial
regulators in Britain, but did not take any action to limit activity on the
account.
Weeks later, in July of the same year, a
transfer request was made for the bank to transfer the funds to a bank in
Lebanon. A document on this request was made available to the British court,
signed by Nigeria’s Attorney General. This was to enable release of the funds
because some part of the funds were affected by a court-ordered freeze ruling.
The judge approved the release of $800million of the said funds, but also
expressed particular concern about the fact that the request may “a
money-laundering exercise”.
However, the $800million was transferred as
requested, but the Lebanese bank, Banque Misr Liban, rejected the transfer.
After the rejection, a transfer request was sent to JPMorgan Chase to send the
funds in two deposits of $400million each to two Nigerian bank accounts owned
by Etete. While JPMorgan reported the transfers to the British Serious
Organised Crime Agency (now the National Crime Agency) as suspicious, it went
ahead to make the transfers anyway. In 2013, another $74million was requested
to be transferred to a corporate account belonging to former oil minister based
in Nigeria.”
The robustness of the entrenched system of prudence and
accountability would have averted the report on the front page of “Vanguard”
newspaper of April 2, 2019.
Headline: “NIGERIA SPENDS N10 TRILLION ON
PETROL SUBSIDY”
“At the backdrop of the continued comatose
state of Nigeria’s refining capacity, the country may have spent about N10
trillion in the provision of pump price subsidy on imported petroleum products
from 2006 to 2018.
A research report by BudgIT, a public
finance focused Non – Government Organisation, NGO, said this amount came from
the price shocks in the international energy market as well as the exchange
volatility.
However, the report also indicated that the
subsidy regime has opened Nigeria’s public finance to huge corruption and
illegal exportation of petroleum products to neighbouring countries.
The report titled, “Nigeria’s Petrol
Subsidy Regime: Dilemma of the World’s Most Populous Black Nation”, stated:
“Nigeria currently imports an average of 91 percent of its daily petrol needs,
thus disproportionately exposing local petrol prices to price shocks from international
factors of production and exchange rate volatility.
There is a near perfectly inverse
relationship between the fall in the value of Naira and the rise in the cost of
imported petrol. That is, when next the Naira is devalued, Nigeria’s subsidy
bill can be expected to jump.”
It stated further: “The continuation of
petrol price regulation perpetuates safety nests for exception forms of
corruption within the country’s subsidy regime. Import subsidy creates petrol
price arbitrage – the differential between the regulated price in Nigeria and
the high petrol in Nigeria and the high petrol prices in neighbouring countries
– which is big enough to incentivize smuggling of subsidized products
to neighbouring border towns.”
On the implication of the adverse
development, the report stated: “BudgIT notes with dismay fuel subsidy deprive
Nigeria of funds needed for critical socio-economic development as it
discourages investors, who generally prefer a deregulated industry, from investing
in the downstream sector especially in the area of refinery construction and
operation. For instance, the 10 trillion consumed by the subsidy regime is
sufficient to construct 27,000MW of electricity or build about 2,4000 units of
1000-bed standard hospitals across 774 local government areas of Nigeria, found
our research.
“We equally note that the Nigerian masses
worship low oil prices. More so, the political class fears that increases in
petrol price (and in the cost of living by extension), occasioned by a
deregulated price regime, and could become a flashpoint for mass uprisings and
political instability. Nonetheless, we can never shy away from the opportunity
cost of the corrupt subsidy regime.”
Rather than restrain itself based on the conviction
that silence is golden, “Vanguard” newspaper of April 1, 2019 adopted the garb
of the town crier and went to town with the consequences of our brazen
misconduct, sheer incompetence and monumental mismanagement of our affairs.
What we are handed is one score card as if to remind us
that if the Bank had managed its affairs with similar complacently it would not
have lasted one hundred and twenty – five years.
Headline: “NIGERIANS NOW 6TH MOST MISERABLE
PEOPLE GLOBALLY.”
“Data compiled by Steve Hanke, an economist
from John Hopkins University in Baltimore, United States, has classified
Nigerians as the sixth “most miserable people in the work.”
The Misery Index was calculated using
economic indices, including unemployment, inflation and bank lending rates.
Venezuela, Argentina and Iran, the
countries, which topped the index, had high inflation rates as the major
contributing factors.
For Nigerians, the unemployment rate was
the major contributing factor. Meanwhile, Peoples Democratic Party, PDP, has
described Steve Hanke’s report as a vindication of its position “all this
while,” saying the nation has sunk into a new low since President Muhammadu
Buhari assumed power in 2015.
“The original Misery index was just a
simple sum of a nation’s annual inflation rate and its unemployment rate. The
Index has been modified several times, first by Robert Barro of Harvard and
then by myself,” Hanke, the economist who compiled the list, told Forbes.
“My modified Misery Index is the sum of the
unemployment, inflation and bank lending rates, minus the percentage charge in
real GDP per capita. Higher readings on the first three elements are “bad” and
make people more miserable.
“These are offset by a “good” (GDP per
capita growth), which is subtracted from the “bads.” A higher Misery Index
score reflects a higher level of “misery,” and it’s a simple enough metric that
a busy president, without time for extensive economic briefings, can understand
at a glance.”
In total, three African countries, Nigeria,
South Africa and Egypt, fell between the top 10 most miserable countries.
Report shows Nigeria is sinking under
Buhari – PDP.
Reacting to the development, PDP’s
spokesman, Mr Kola Ologbondiyan, tasked the ruling All Progressives Congress,
APC, to perish the thought of the planned increment in Value Added Tax, VAT,
saying such would only make it more difficult for the “already traumatised
Nigerians.”
Ologbondiyan said “That report is a
vindication of the position of the PDP, all this while. The economy has
virtually collapsed under President Buhari and the man is even mooting the idea
of piling more pressure on Nigerians.
“Nigerians have never suffered like they
are suffering today because those charged with the responsibility of managing
the economy have failed completely. They have no idea of what it takes to
manage an economy like ours.
“As an opposition party, we call on the
Presidency to take urgent steps to fine-tune the economy, create jobs for our
teeming youth if only to justify that a government is in place.
“In the interim, we advise them to stop
their plan to increase VAT as that will only fetch millions of Nigerians
additional pain and discomfort.”
In the old days, the Bank would have mounted huge
pressure on the government in order to ensure that the budget was passed by the
parliament well before the commencement of the financial year in addition to
ensuring proper co–ordination between the Ministry of Finance and the Central
Bank in order to ensure cohesion between fiscal policy and monetary policy.
Prudent management of the economy was paramount and it was anchored on the
balanced budget.
What now prevails is unrealistic budget projections
whereby revenue expectations are not aligned with the realities on the ground.
Inevitably, the government has been piling up huge local and foreign debts
leaving a trail of unsustainable debts, massive unemployment (especially
amongst women and youth) and wobbling economy.
On CNN, the Minister of Finance, Hajia Zainab Ahmed
solemnly declared:
“We intend to fund the 2019 budget through borrowing
locally and internationally with a spread of 50:50. Our focus is on
concessionary long-term loans.”
It was more or less the same narrative when her
predecessor Kemi Adeosun was on Aljazeera:
“The first thing to note is that there are
no quick fixes, but our strategy is clear and the expected outcomes are pretty
compelling. Our immediate economic imperative is to provide a Keynesian
stimulus to reflate the economy. The 2016 focus is underpinned by a desire to
radically reposition Nigeria’s economy.
The 2016 budget is being debt funded and
the borrowings are targeted at the financing of capital projects to address the
infrastructure deficit, create jobs and build the platforms for optimisation of
the non-oil economy that will see Nigeria prosper.
Our borrowing policy will remain
conservative and will see us access the lowest available funds, hence our
decision to approach multilateral agencies in the first instance, for budget
support at concessional rates as low as 1.5% per annum.”
Therefore, it was no surprise
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