Group urges EFCC to investigate CBN’s $7 billion loan to consortium of banks

Posted by News Express | 31 January 2016 | 3,123 times

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The Civil Society Network Against Corruption (CSNAC) has urged the Economic and Financial Crimes Commission (EFCC), to investigate a Central Bank of Nigeria (CBN) soft loan of $7 billion granted to a consortium of banks in 2006.

In a petitioned sent to the anti-graft agency and signed by the coalition’s chairman, Mr. Olanrewaju Suraju, CSNAC stated that nine years after the disbursement of the soft loans to the banks, no public report or account has been rendered by CBN on the $500 million given to each of them.

The petition, a copy of which was received today by News Express, reads: “On October 4th 2006, the Central Bank of Nigeria (CBN), through its Head of Corporate Affairs, Mr. Festus Odoko, had disclosed that the CBN had apportioned $7billion out of the nation’s external reserves, which stood at $38.07 billion, as at the end of July, 2006, to 14 global asset managers and their 14 Nigerian banks local partners, to manage. The amount reportedly bequeathed to the asset managers represented 18.39 per cent of the total external reserves and was hitherto kept with foreign banks.

“The 14 global asset managers and their local counterparts were Black Rock and Union Bank of Nigeria Plc; J.P. Morgan Chase and Zenith Bank Plc; H.S.B.C and; First Bank of Nigeria Plc; BNP Paribas and Intercontinental Bank Plc; UBS and United Bank for Africa Plc; Credit Suisse and IBTC Chartered Bank Plc; Morgan Stanley and Guaranty Trust Bank Plc; Fortis and Bank PHB Plc; Investec and Fidelity Bank Plc; ABN Amro and Access Bank Plc; Cominvest and Oceanic Bank Plc; ING and Ecobank Plc; Bank of New York and  Stanbic Bank Plc and; Crown Agents and Diamond Bank Plc.”

CSNAC noted further that, “According to the reports, CBN gave each asset manager, $500m of the external reserves to manage. Almost nine years after this pronouncement, no public report or account has been rendered by CBN on these the $500 million given to each of the banks. Also realising that 3 of the banks (Intercontinental Bank, Bank PHB and Oceanic) were bought over by other banks and or liquidated between 2006 and now.” 

While recounting that on June 17, 2015, it sent a letter to the CBN Governor under the Freedom of Information (FOI) Act to request for information on the $7 billion ‘soft loan’ granted to the aforementioned 14 consortium of bank, the coalition said six months after the receipt of the request by the CBN Governor, “our network has received neither acknowledgment nor response to our request from the bank.”

Under the FOI Act, 2011, such information should be made available to the applicant within seven days of the receipt of such request.

“The Bank’s failure to response reeks of unwholesome practices and economic sabotage. Perhaps, it is the assumption of officers behind the Programme that the investment there would be no account to be rendered to Nigerians on days as this. CSNAC is hereby requesting that the Presidency probes this matter and inform Nigerians exactly what is going on or has gone wrong with the $7 billion soft loan,” the petition said.

Source: News Express

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