Why Sanusi’s Banks’ Rescue Failed, May 28, 2012
Four years after Mallam Sanusi Lamido Sanusi, the governor of Central Bank of Nigeria annexed five banks viz: Intercontinental bank, Oceanic Bank, Bank PHB, Afribank and Spring Bank and injected some N1.3 billion of tax payers’ money for their survival, the direct opposite has been the case. The money injected by Sanusi was meant to prevent the embattled banks from going under and to reassure both investors and depositors of the safety of their investments and deposits. However, four years down the line, the expected breath of life is lacking in the banks, rather they have been asphyxiated due to either non-conducive polices or deliberately targeted policies. Of the five rescued banks, three; Bank PHB, Afribank and Spring Bank have gone under while two; Intercontinental Bank and Oceanic Bank have been acquired by other banks.
This has left many wondering the rationale for the expensive bail out in the first place. The truth is that the banks are worse off today than when the CBN governor annexed them and the question is what went wrong? In this cover story, Ibrahim Mohammed x-rays what role Sanusi’s bailout played or did not play in the life of these near failing banks.