Soludo replies Okonjo-Iweala

soludo charles new

The former Central Bank Governor, Pro­fessor Charles Solu­do, has put a lie to the claims by the Finance Minister and Co-ordinating Minister for the Economy, Dr.(Mrs) Ngozi Okonjo-Iweala, that he bungled the banking consolidation exercise, say­ing that over N30trillion so far must have been stolen or unaccounted for under her.

In his latest article made available to Daily Sun, Solu­do took a swipe at the Fed­eral Government’ s attitude to constructive criticism, saying “anyone who disagrees with the government must either be ‘insane’ or have a ‘char­acter’ deficiency or must be ‘looking for a job’ or ‘without honour’, or a ‘charlatan’.”

Responding to the issues raised by Mrs Okonjo-Iweala ,the former CBN governor described them as “comical, wild judgment on my tenure of office which I believe to be totally false and baseless.”

Accussing the minister of supervising a ministry where an unprecedented looting of the treasury is taking place, he said:

“ While you are introducing austerity measures and soon to immiserate the citizens, our public finance is haemorrhag­ing to the point that estimated over N30 trillion is missing or stolen or unaccounted for, or simply mismanaged— under your watch!As I write, the naira exchange rate to the dol­lar is at N215 (from N158 a few months ago) and unless oil price recovers, this is just the beginning.”

On the banking consoli­dation, he said it was both a revolution and a war and most people thought it was impos­sible,

His words: “Nigeria sur­vived the global crisis because of this, and it is the banking sector that has largely been powering the economic growth you claim (compare banks trillions of naira credit for investments in the produc­tive sector with your govern­ment’s miserable expenditure on critical infrastructure and investment; much of your borrowing – bonds – is from the banks). Your privatization of power sector, several PPP projects on infrastructure, etc, are now possible because of the mega banks. Today, Nigerian banks syndicate multi-billion dollar loans— unthinkable before. Madam, if the consolidation was ‘mis­managed’, there would not have been any bank to start with in the aftermath of the global crisis— as President Yar’adua correctly pointed out. Even you, during a re­cent presentation at the Ban­quet Hall in Abuja advertised consolidation as a historic achievement. How can you recognize a ‘mis-managed’ project as an outstanding achievement?

“Let me be clear: the quan­tum size of the new banks following consolidation presented challenges of risk management and supervision. We deployed all we had and overworked the CBN staff. The carry-over of bad loans from the consolidated banks was quickly cleaned up. To the best of my knowledge, we instituted stringent regula­tory and supervisory regime (consistent with best prac­tices at the time). We even had resident examiners in the banks and required bank MDs to personally sign their reports to CBN. To our credit, non-performing loans (NPL) came down from 22 per cent in 2003 and 2004 to 6 per cent as at 2008. Anywhere in the world, a central bank that brought NPL from 22 per cent to 6 per cent over a four-year period does not look like one with a loose supervisory re­gime. Name other developing countries that performed bet­ter, Madam. So, on point of fact, Madam lied. Yours was a reckless assertion without ba­sis by a Finance Minister.

“Your response on the pov­erty issue is deeply troubling. You accuse me of using “2011 statistics on poverty by the NBS to support his argument, while ignoring more recent figures”.


Sun News Nigeria


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