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Have you heard? A tidal wave just hit the banking sector.

At the stroke of the

pen, the career trajectory of top management executives of five banks took a
southward curve.
Mr Okey Nwosu, Managing Director of Finbank; Bartholomew Ebong, Managing Director,
Union Bank; Sebastian Adigwe, Manging Director of Afribank; Mrs Cecelia Ibru,
Managing Director, Oceanic Bank; and Erastus Akingbola, Managing Director of
Intercontinental Bank have been tragically enlisted in the hall of bad bank
Between Akingbola and Nwosu it is difficult to judge who won the publicity-loving
CEO campaign. Akingbola probably made a very public show of what has turned out to
be his last outing as the managing director of Intercontinental Bank through his
courtesy visit to the Sultan of Sokoto within the week.
If he was in showbiz, his appetite for publicity would have been easily understood
but he was in the banking, sector a very conservative sector. It is unclear what
all the craze for publicity did to the bottom line of his bank.
The picture of him with the Sultan adorned the front pages of most newspapers on
Wednesday. Well, it was his last as managing director of his gasping bank.
It is either he did not see the handwriting on the wall or chose to ignore it and
perhaps, even pretend that all was well. His career and others like him came to a
screeching halt on Friday.
He will be leaving behind about N300 billion in negative shareholders’ fund, a
large chunk of which was given to oil companies to finance importation of
petroleum products and construction of depots. Unfortunately, the bulk of these
loans have remained unpaid and unserviced and perhaps lost forever.
The soft spoken Amazon of banking Mrs Madam Cecilia Ibru also led her bank to a
negative shareholders’ fund of about N400 billion, most of which also went into
financing of construction of depots, jetties and product imports.
But interestingly, about 30 percent of her bank’s loan portfolio may have gone to
her family’s business interests in aviation, hotels and publishing, among other
concerns run by the Ibru family.
While Akingbola is said to owe his bank billions of naira, Oceanic Bank and
Intercontinental, it will be recalled, also contributed N1 billion each to
Yar’Adua’s election campaign.
Between the five banks whose CEOs got fired - Intercontinental Bank , Oceanic
Bank, Afribank, Finbank and Union Bank – it is estimated that they lost N900
billion of shareholders fund.
Soon after consolidation, banks began a very aggressive campaign on which bank is
bigger? It was fought with all vigour and rigour. So began the campaign, “My Bank
is Bigger than Yours”. All sorts of statistics were bandied around by many of the
banks to claim superiority over others.
From my bank is bigger than yours, the campaign steadily moved to the downstream
oil sector, with the slogan, “My Depot is Bigger than Yours”. The competition here
was no less fierce. Every available space on the Apapa axis was turned into the
construction of tank farms.
The runaway oil price fed a frenzy for big returns, and for a while that hope seem
well placed. Accordingly, the oil nouveau riche lived the life of opulence and
grandeur - private jets and exotic cars easily became their play toys while
mansions of varied architecture dotted the neighborhood skyline. All were built
with depositors’ money and flaunted menacingly at their faces.
But suddenly, the bubble burst. Oil price crashed, and trouble started. To further
compound this, the naira was dramatically devalued. Debt in billions of naira
piled up. And soon the banks came knocking.
However, the new Pharoah at the CBN who did not know Joseph and would take no
prisoners sat in judgement. A price must be paid and nothing but the careers of
those who breached public trust and abused their position was good enough.
Buoyed by the tremendous successes they recorded in the various public offers they
embarked on, banks lost risk management control and became reckless with
investors’ and depositors’ money. According to an insider, the banks enticed many
of the oil chiefs into buying their banks’ shares by giving them fat loans without
collaterals during the stock market boom.
When the market crashed, and values of shares plummeted, a gapping hole was dug in
the books. The hole grew deeper and wider when oil prices also crashed and the
naira shed weight, losing 20 per cent of its value.
Suddenly the competition for my depot is bigger than yours tragically turned to my
debt is bigger than yours. Who knows where it will go from here?

Culled from Thisday.