Suspended Governor of the Central Bank of Nigeria (CBN), Sanusi Lamido Sanusi, has written to President Goodluck Jonathan, defending himself and the Bank’s management against allegations of fraud leveled by the Presidency and the Financial Reporting Council of Nigeria (FRCN) which led to his suspension on February 19.

Mallam Sanusi in a statement released in Abuja yesterday disclosed that he submitted a memorandum to President Jonathan, with supporting documentation, on March 10, effectively addressing all the allegations contained in the FRCN report.

“These responses is to enable the general public see that each and every allegation levelled against the CBN under my leadership is false and unfounded, and that many of the allegations were malicious and fabricated, having been designed to mislead the President into believing that the Management of the Central Bank was guilty of misconduct and recklessness,” Sanusi said in the statement.

According to him, “Having submitted my response to the President, I am further compelled, following the recent press briefing and comments by the Senior Special Adviser to the President on Media, Dr Reuben Abati, as well as other numerous references to the allegations in both local, international and online media, to put to the public my responses, in the interest of transparency, accountability and my responsibility to the Nigerian people.

“Let me also state that I saw the FRCN “Briefing Note” for the first time when it was attached to my suspension letter. At no time was this report sent to the CBN either by the President or the FRCN for comments or explanations.

“A careful examination of the allegations contained in the FRCN “Briefing Note” to Mr President, will show that each of the allegations could easily have been resolved by a simple request for clarification or more careful review. There is no doubt that if the CBN had received the Briefing Note, which was prepared in June 2013, all the misconceptions, misrepresentations and erroneous inferences contained therein would have been cleared . . .

“Having provided detailed explanations, backed by verifiable documents, it is my sincere wish that His Excellency, Mr President, in line with his adherence to fairness and justice, will apply the same rationale and rigour to other agencies of the Federal Government that have had serious allegations and queries levied against them, and prevail upon them to provide responses and explanations with the same level of clarity and transparency.”

Sanusi in the statement listed his achievements during the five years he spent in office, noting that the CBN experienced a remarkable turnaround during the said period in terms of administration and other monetary and fiscal policies.

Regarding monetary policy, he said: “CBN has improved its institutional framework for policy-making. A properly constituted Monetary Policy Committee (MPC) with a clear mandate for maintaining stability has been established.

“The MPC has been supported by improvements in research, data and forecasting capacity, and we have also paid attention to clear communication of our objectives to the market. As a result, headline inflation has remained below 10 per cent since January 2013, from a peak of 15.1 percent and 13.9 percent in 2008 and 2009 respectively. Core inflation has equally declined from 11.2 per cent in December 2009 to 7.9 percent in December 2013, while food inflation maintained a downward trend from 15.5 percent in December 2009 to 9.3 percent in December 2013.

“In addition to the conventional liquidity management products, CBN under my leadership approved financial products to manage liquidity in non-interest financial institutions. The CBN also promoted the formation of the financial Markets Dealers Quotations Over-the-Counter (FQDM OTC) Plc as a self-regulatory OTC operator.

“In the area of safeguarding the value of the local currency and maintaining stability in the foreign exchange market for the overall sustenance of macro-economic stability and growth, the Bank over the period successfully maintained a stable exchange rate regime and a robust external reserve position conducive to sustainable growth and development.

“On the Banking System, I was appointed Governor in the middle of a global financial crisis when the Nigerian banking system was on the verge of collapse. The Bank moved swiftly to remove the managing directors and executive directors of the banks where major corporate governance failures were discovered, thus, providing liquidity support.

“We pioneered the setting up of the Asset Management Corporation of Nigeria (AMCON) to purchase non-performing loans, recapitalize the banks and pilot a process that led to mergers and acquisitions, as well as recapitalization of all the weak and failing banks. As a result, all financial soundness indicators, Capital Adequacy, Asset Quality, Liquidity and Profitability ratios were normalized.

“As a result of the work by the Bank, not a single depositor or creditor lost money in any Nigerian bank during or after the financial crisis.

“In addition to the quantitative measures, we broke up universal banks and encouraged the setting up of specialized banks (including the first Non-interest Bank in the Country’s history), pushed for the adoption of IFRS and Basel 3, enhanced risk-based supervision, issued Competency Guidelines for the staff in the banking industry, established a Consumer Protection Department and developed a Financial Inclusion Strategy and Roadmap, among others for the CBN.

“The Bank implemented policies aimed at reducing the excessive use of cash in the system to ensure safety, improve efficiency and curb money laundering. The transformation of NIBSS, the insistence on interoperability of channels, encouragement of electronic banking, the licensing of Mobile Money Operators, the Agent Banking and tiered-KYC frameworks have all led to rapid growth in volume and value of non-cash transaction and enhanced financial inclusion.

“The Bank has equally played a very critical leadership role in ensuring industry compliance with environmental sustainability and governance standards, including a strong focus on women and the handicapped.

“The CBN in the last five years has taken a leading role in providing long-term low-cost funding to priority sectors of the Nigerian economy in a bid to help in bringing to reality the Transformation Agenda of the government of Your Excellency. We have provided these funds at single-digit interest rates to micro, small and medium enterprises, as well as to companies operating in the power, aviation, and agricultural sectors of the economy, and also to large industrial enterprises with potential for structural transformation.

“The Bank has invested in human capital, improved staff welfare and attracted and retained specialised skills in the areas of Banking Supervision, Information Technology, Shared Services and Risk Management.

“On Financial performance, the Bank has in the last five years kept a lid on overheads and cost of currency management. As a result, the Bank has continued to produce sterling results and contributed substantially to the Federal Budget.

“In the five years, 2009 - 2013, the Bank contributed N376 billion to the Federal Budget as Internally Generated Revenue (IGR). Based on 2012 financials alone, we paid N80 billion to the Ministry of Finance. On the basis of the 2013 results and at the request of the Coordinating Minister of the Economy (CME), we paid N159 billion to the Ministry of Finance in February this year, the same month the audited accounts of the CBN were approved by the Committee of Governors (COG).

“Indeed, due to the precarious position of Government finances, the CBN in February 2014, upon the request of the CME, gave the Ministry a further ‘Advance IGR’ of N70 billion in anticipation of 2014 profits.

“Similarly, in 2008, the year before my appointment, the CBN contributed N8 billion to the Federation Account. Although the Bank is not a profit-centre, in the first four years of my term, the Bank alone contributed 75 percent of the total IGR paid by MDAs leading to commendation by the House Committee on Finance at several Public Hearings.”

In a memorandum responding to the FRCN allegations of corporate governance, Sanusi said the council ignores the fact that global best practice is that the Governor of the Central Bank is the Chairman of the Board of Directors of the Central Bank.

On the alleged fraudulent activities, especially the payment of Nigeria Security Printing and Minting Plc (NSPMP), Sanusi explained that the expense item of N38.233 Billion to NSPMP was made up as follows: N28.738 Billion payment to NSPMP in 2011; N6.587 Billion accrued liability in 2011 but paid in 2012 when deliveries were received; and N2.829 Billion audit adjustment journal entry into the account at the end of 2011 in respect of prepayment to NSPMP.

In the same vein, Sanusi responded to the allegation of charter fees with Emirate Airlines which allegedly does not fly local charter in Nigeria. He said: “The CBN neither engaged, paid nor claimed to have paid Emirates Airlines. Rather, the CBN engaged and entered into an Air Charter Services Agreement with Emirate Touch Aviation Services Limited, which is a local Nigerian charter service company.

“With respect to Wings Aviation Limited, the CBN contracted Wings Aviation Limited, which changed its name to Jedidiah Air Limited on 21 August 2009 but only notified the CBN of the change on 28 February 2012. With respect to Associated Air Limited, the CBN did in fact pay a total of N1.025 Billion to Associated Airline Limited.”

•Photo shows suspended CBN Governor Sanusi.

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