[CBN Governor, Godwin Emefiele]

The trending vocabulary/diction in the financial services sector now is the phrase: “Name and shame list.” This phrase appears to be   the “Change” or Chanj which the ruling

All Progressives Congress (APC) brought in its baggage as it strives to come to terms with the realities of running a democratic institution.” The APC which ran its 2015 election on the banner of “Change” (aka chanj) had its Presidential candidate, MR. Muhammad Buhari,  returned  by the electoral body as the winner of the poll. Since his inauguration as President, the APC has been  fumbling and wobbling in a desperate bid to  acclimatize with the task of running a normal government. Whether the APC will fumble

However, it is pertinent to state that never before has this country witnessed such a regime of clueless political leaders who seem so unprepared for action after raising high hopes on its ability to transform Nigeria to an Eldorado via the instrumentality of Chanj. In its desperation to take off with something to impress the mass of people whose hopes were raised very high it came up with this idea of a “Shame List”. The brainwave of a shame list is an offshoot of the much hyped reports that the principal officers of the new administration in Nigeria are sadists whose interest in clinching the levers of power is to bask in the euphoria of witch hunt and vindictiveness. 

The Name and Shame List also casts a pall of doubt on the   business suave of those who now run the Nigerian Government. A School of Thought holds the opinion that the Name and Shame List is an eloquent testimony that those who  are  now set to ruin?, sorry, rule Nigeria are  expired politicians who do not  know a thing about what goes on in the 21st century world of globalization or the global  family. Or how else can one rationalize a policy which seeks to demonize borrowing from the deposit banks, even when the same government goes cap in hand soliciting for all manner of  financial interventions to enable it  weather through the ongoing turbulence in its new responsibilities.

 We just heard that the selfsame Buhari government was recently given a loan or grant of over $2 billion for the uplift of the Boko Haram battered North East. Yet, the same government which presented its “Wish list’ (a euphemism for begging for financial aid from 1st World) to the developed countries a short while ago is  asking for the head of business men who borrowed money by way of loans or overdrafts from the  money markets or deposit  banks. Today our  political  leaders  are  running  the  banks  from ASO Rock. 

It is pertinent to mention that this is, perhaps, not the first time for some people to come up with this unfortunate brain wave of putting the so-called “Overdraft Billionaires” to shame. The first time this antiquated and medieval move was made was when the then Governor of Central Bank, Sanusi Lamido Sanusi (SLS published  the names of prominent Nigerians who owe various amounts in the banks. He labeled them “Overdraft Billionaires” and there was so much celebration among the Mafiosi group . As sadists, people from some sections of this country derive joy in subjecting others to ridicule and shame even when the  need does not arise.

The pertinent question is: When did it become a criminal offence for people to seek financial assistance in the forms of loans, overdrafts and the like from the banks? Do people know that borrowing is the most lucrative aspect of banking? There was a time in this country when the federal government had controlling shares in the first grade banks. Acting on the orders of the then President, Chief Olusegun Obasanjo,   the then  Governor of Central Bank (CBN),  Professor Soludo, a professor of Economics, embarked on the humungous task of privatizing  and restructuring  the about 89 banks in the  country  in a bid to relinquish federal government  equity holding in these  banks. 

It was  agreed that  government is a bad businessman  , thus the banks should feel free to  run the banks in the  best way they could without  intervention from the Federal Government.. As the APEX Bank, the CBN would still play the role o regulatory body whose financial and monetary guidelines must be faithfully complied to the minutest detail. Through this process  of mergers  and acquisitions, the  banks in the country were pruned down from 89 to 25 mega banks. Never before has such volume of mergers and acquisitions being successfully carried out in any part of the  world in a record time limit of 18 months. But Professor Soludo who hails from the South East State of Anambra actualized it and this was the end of  bank collapse in Nigeria. It is sad that rather than improve on what the Obasanjo /Soludo efforts (Obasanjonomics & Soludonomics) achieved, some misguided  people are taking us back to the  age of voodoo banking. 

Today, bank depositors are afraid to approach their banks for financial intervention for the reason that  the Damocles Sword  of ASO Rock Villa  oscillates over their heads. Is this the CHANJ the APC promised? However, a people must get the type of government or leader they deserve. When a country engages in reverse gear and recalls a septuagenarian coupist who  ruled  or  ruined them in 1983-1985(over  30 years ago) to take over the levers of power in 2015, what do you  expect  from such  an analogue leader in a digital  world. Nigerians asked for chanj; now that the chanj has come, we must tread softly .The American warns:  “Be wary of what you ask because you may get it.”: We ‘aint seen anything yet”. At home, the Mbaise man says:”Onwebe ihe ihuru ge na kpokisi”. Please ask the Mbaise man close to you to translate it.

In fact, I have been trying to give myself some soft landing to drop my  main message. So far, I have been doing the preambles to this discussion. Now, it’s time to give a free consultancy to the managers  of our economy and especially, the Chartered Institute of Bankers of Nigeria (CIBN)  and the Advertising Practitioners’ Council of Nigeria(APCON).I am shocked that  the  two bodies  have maintained  a conspiracy  of silence  while some  misguided people set out to destroy  the  banking sector. In a normal  country, these two  bodies would  have  issued  press releases to  intimate the  public and the authorities on the  illegality  and  futility of the so-called “Shame List”. Since what we have in Nigeria  today is  a managed  democracy or even a  diarchy, the CIBN and APCON  advice may not be heeded but at least  they would  have  had  their say .Now this  is  my lecture  to  the FGN,CIBN and APCON and  the  banks .

The SHAME LIST is  a primitive, antiquated

 approach  to  modern  banking  and  those

 who  get  involved will  bear  the  full

 consequences  of  their  idiocy

Advice to FGN & CIBN: The federal government  should  withdraw  from the  ongoing embarrassment   of  innocent  businessmen  who  entered  into  legitimate  business  pacts  with  their   bankers. There is a need to  state that  the  FGN is at liberty  to  nationalize  the  banks  or  apply to hold golden shares  in  such  banks, if  it so  deems  fit. It can easily  actualize  this nationalization or golden shares  through  the  National  Assembly. Until such  nationalization  or  golden shares  are  in place, it is not the duty  of  ASO Rock  to  direct  the  affairs  of  such  banks  from the  Sanctum Sanctorum  of ASO Rock. 

Through the  CBN  monetary policy guidelines, the  Federal  Government  can  regulate  the  activities   of  the  banks  in  such a  manner  that  will  not   cause  panic  or  pandemonium  in  the     economy. A situation  where the  reputation  and  integrity  of  a  cross section  of   Nigerians  are  being  rubbished  everyday  in  the  papers  in  the so-called “Shame list” is  both  despicable, deplorable  and  repugnant to  the  internationally  recognized  professional  ethics  in  the  civilized  world. It  falls  short  of  International  Best  Practices. It must be stopped now. It  is an act  of sadism  for  any  government  to  operate  a policy  which  intention  is  to  subject  innocent  members  of    any  sector  of  the  economy, in this  case  the    bank  publics,  to  ridicule  and  shame, more  so, at a time our Federal Government  is  all  over  the  world  begging  other  nations  to  treat  the  country as an ALMAJIRI  who  survives  on  mendicancy.

Advice  to CIBN: The Chartered Institute  of Banking ( CIBN) is a professional  body  which  ensures  that   professional  excellence  is  enthroned  in  the  banking industry  in  Nigeria. It  should  not watch  while  the  political  class  try  to  rubbish  the  great  professional   ethics  of  the  banking  profession- an  industry  that  has  existed  for  over 100 years  in  Nigeria. The  CIBN  should  seek  audience  with  the  political  leaders  in  order  to  give  them a  lecture  on  the  role  of  professionalism in  the  banking sector. Politicians  are very  greedy  and  full  of  hate; they  are  not  in a position  to  teach  bankers  who  are  technocrats  the  best  ways  to  run  the  banking  sector.

 If anything,  genuine  investors  will  be  scared to  invest  in  an  environment  that  glorifies  the  so-called  “Name  and Shame”  platform. It is primitive, primordial and driven by hate and vendetta. The CIBN must  insist  that this  obnoxious  practice  is   stopped  now. It  shall  be  the  task  of  the  Cibn to jealously  guard , preserve  and positively    project  on  the  noble  profession  of  banking which  is  based on the principle  of “Trust  and Honesty”. The  CIBN  must  assert  its  relevance  now  or  never.

ADVICE  TO  APCON: The Advertising Practitioners Council of Nigeria (APCON) was established by the Advertising Practitioners Act No. 55 of 1988, as amended by Act No. 93 of 1992 and Act No. 116 of 1993 (now Advertising Practitioners Registration Act Cap A7 of 2004). The adoption of a broad national mass communication policy by the National Council of Ministers in January 1988 was a milestone in the establishment of the Advertising Practitioners Council of Nigeria (APCON). The various discussions that followed the adoption of the national mass communication policy articulated the relevance and the leadership role of advertising to the nation’s social, political and economic development as well as the need for official recognition and regulation of the practice. 

APCON  is  the  regulatory  agency  in  the  Advertising  Profession  .It  should  not  watch  idly  while  the   best  traditions  of  advertising  are  bastardized  and  ridiculed. The APCON  must  ensure  that   all  materials  for   placement  in  the media  are  screened  and  approved by  Registered  Professionals  in  Advertising (RPAs).There  is  a  decided  case  in  the   court  which  demands  that   all  advertisement  in  newspapers  must  be  approved  by  members  of APCON. The  Nigerian  Publishers  Association  of  Nigeria(NPAN)  appealed  the  case. The  APCON  must  go  back  to  the its   roots  to  ensure  that  the   Federal  Government  is  educated  to know  that   there  are  laid  down  principles  of  advertising  and  those  principles  must  not  be  undermined. The APCON  must  work  in  synergy  with  the   Central  Bank  and  the CIBN  to  restore  normalcy  to  the   banking  profession  and  the  advertising  industry.

ADVICE TO THE BANKS: We  all  know  that  Banking is an honourable  professional  and  what  happens  between  an  account  holder  and  his  banker  is  guided  by  the  principle  of  confidentiality. It  is  secret – if  that  is  what  you want  to  hear. A third  party  should  not  know  what  transpires  between  a  banker  and  his  customer, not  even a wife  or a husband  should  have  access  to  the   details  of  the  account  of each  order  , unless  it is a joint account or  there is an express  authorization  to  that  effect. It’s  like   asking  a medical  doctor  to   publish  the  details  of  his  patient’s  medical  condition  on  the  grounds  that  such  a  patient  is  unable  to  settle  his  bills. In  the  same  manner, a  Reverend  Father  should  announce  the  sins  confessed  to  him  by  a  faithful  on  the  grounds  that  such  a   faithful  is  owing  the  Church. Are these moves rational and reasonable? If  not, why  subject  bank  customers  to  such  selective  punishment  and  trauma?

A good  banker  knows  that  lending  is  a  very  important  aspect  of banking. It is the  most  lucrative  aspect  of  banking  and  the  riskiest  aspect  also. Bank lending is  guided  by the  aide memoir: “PAPERCHAMPS”. This aide  memoire  reminds  the  banker  that   there  are  some  basic  guidelines  in  deciding  to  lend  money  to  a  customer. They  include(1)period  of  repayment;(2) amount  of  loan/overdraft;(3)exchange rate  content;(4)character and  integrity  of  the  borrower  and  (5) security  -often  described  as  collateral  security. These requirements  are  embedded in  the   aide memoire-PAPERCHAMPS. 

When  applicable,  the  banker  does  a  cash  flow   and  balance  sheet analyses  to  guide  him. Often  the  security  may  be  a  legal  or  equitable  mortgage  over  property. It can be a floating charge over the assets of the   borrowing customer. In  fact, the  most  important  factor  in  lending  is  not  the  security  provided, hence  the  security  comes  last  in  the   PAPERCHAMPS. This  shows  that in lending,  there  is  no  substitute  to  character  and  integrity  of  the   borrower. No  quantity  of  security  can  redress  the   disadvantages  of  lending  money  to  a  known  fraudster  or  criminal. Professional  bankers  know  what  I am  saying  ;there is  no  need  to  over flog  it since we are  not  in  the  classroom.

If  a  borrower defaults,  bankers  know  how  to  go  about  it. They  don’t  need  to   subject  such  a   borrower   to  shame  or  ridicule. In a worst case scenario,  the  bank  can  go to  court  to  seek  order  of  court  to  realize  the  securities  held  in  its  possession. A bank  does  not  need  ASO ROCK  to  tell  it what  to  do  when  faced  with   sticky  lending or a bad  loan. We all  know  what  to  do. Sometimes,  a  banker  can  even  help  to  turnaround  the   sagging  business  through  professional  advice  or  even  via  injection  of   further  funds. Bankers  do  not  need  to  drag a  borrower  to  the  Buhari’s Shame  List. It  is  an  abnormality  and  banks  must  kick  against  this  Shame List; it’s  is  an anathema; it  seeks  to  demonize  borrowing. It  appears  to  be  a subtle  way  of  forcing  the   business  class  to  patronize  the  ISLAM, IC BANKING  SCHEME. This is my observation. 

We  must  guard  against   those  who  are  subtly  undermining   conventional  banking in  order to  give  leverage  to ISLAMIC BANKING-  where  they say  they  don’t  charge  interest. Our  businessmen  must  be  vigilant  in order to  see  through  the  veneer  of  the  subterfuge  of  Muslim fundamentalists  who  hide  under  the  canopy  of  the  SHAME LIST to  introduce  Shariah Banking. 

Banks must  also  consider  the  cost  implications  of   publishing  false  details  in  the  SHAME LIST. It  is a defamation  /libel  to   publish  a  person’s  name  as  a  debtor  even  when  there  is  no  cogent  and  verifiable  evidence  to  support  such  a  claim. Such  an  affected person  is  free to  sue  and  claim  damages  which  could  run  into  a  humungous  amount. Banks should distance themselves from the SHAME LIST. This  is  not  the   Change/ CHANJ  they  voted  for. 

The SHAME LIST is  a primitive and   antiquated  approach  to  modern  banking  and  those  who  get  involved  in  it  will  bear  the  full  consequences  of  their  idiocy  when  aggrieved  individuals   storm  the  Temple  of  Justice to  seek  compensation  and   costs  in  regard  to  reputations  that are tarnished  and sullied  by  such  false  and  toxic  publications. To  be  forewarned  is  to  be   forearmed, In  advising  both the CIBN and  the  APCON,I speak  as  an  insider- a member  of  both  bodies. So, I am  speaking  from  an  informed  mind. 

John Mgbe; 08032722897, johnmgbe@yahoo.com