Afribank: New Directors accused of financial recklessness

Replace all tellers in the bank with OND holders
There is a growing groundswell of ill-sentiments among members of staff of Afribank Plc against the Central Bank of Nigeria’s appointed management team of the bank. The staff, across ranking strata, have accused the Managing Director of the bank, Mr. Nebolisa Arah and other Executive Directors of going on a spending spree when their primary task in the bank, predicated on the CBN intervention was that of recovery.

 Aggrieved staff of the bank protested that despite the parlous state of the liquidity position of the bank, as painted by the management team, the Managing Director and his Executive Directors decided to grant to themselves, loans of up to N25million to purchase vehicles for their personal official use.

“This is simply ruinous, I must tell you,” one of the bank’s senior staff said. “These people were appointed to lead the recovery effort of the bank and that supposes cost saving and limitation on expenditure.

“You can imagine how we felt when we got to know that the directors have approved for themselves the sum of N25million each to purchase official vehicle. Is this supposed to be cost cutting or sheer wastefulness? Of course, we are aware that when the erstwhile directors were sacked, they were not allowed to go away with their official cars. We expected that in the spirit of the time, the directors appointed by the CBN to manage the bank as a recovery team, would make do with the vehicles they inherited from the former management team, you can imagine the cost to the bank if you multiply N25million with the number of the Executive Directors and the managing director. 

Other consideration for the aggravation of the bitter sentiment pervading the baking halls of Afribank Plc has to do with the retrenchment and recruitment tactics of the management team. A bank insider told Fortune&Class Weekly of how the new management team forces old staff of the bank through the front doors of the bank only to replace them by favoured people, who are connected to individual Executive Directors.

“Seriously, this is scandalous,” the insider asserted. “Most staff members had prepared for the worst when the CBN appointed directors were inaugurated in the bank. We knew there would be sweeping reforms and most of all staff would have to go. But most of us get scandalized that rather than use the staff strength down-sizing as a cost saving measure, this management team simply turned it to opportunity to provide employment for their cronies. Those of us that were booted out through the front door were replaced by their cronies through the back door, so the question is: What do the supposed cost saving measures, implemented by the bank’s management, intend to achieve?

“Now, why are they halving our salaries and at the same time recruiting new people. It is scandalous,” the insider said.

Describing the general state of anxiety among the mainstream staff of the bank, another insider confided that as things stand, those working as tellers in the bank are, more or less, existing within the bank’s structure on tenterhooks.

“We learnt that the management team has decided to replace all tellers in the bank with OND holders, we are only waiting for when the sack letters would be distributed.”

Afribank Plc was one of the first set of five banks seized by the CBN for failing to satisfy the apex bank indices for capital adequacy, risk management, liquidity and good governance, on 14 August, 2009.

Our effort to talk with the spokesperson of the bank, Mr. Mosshod was unsuccessful because his phone was switched off all through last Friday.

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CENTRAL BANK NEW NAIRA DEFENCE STRATEGY TO FAIL… FOREX ROUND TRIPPING DEEPENS

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Governor of Central Bank of Nigeria, Prof Chukwuma Soludo, may be fighting a lost battle in the foreign exchange segment of the money market. Since November 2008 when the value of the Naira, the national currency commenced a tail spin in a downward spiral that has become unrelenting, the CBN Governor had continued to role out measures aimed at managing the exchange rate of the Naira with other currencies within what is described as reasonable band.

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FED GOVERNMENT LAUNCHES N50 BILLION MICRO CREDIT FUND

The Federal Government has affirmed its commitment to micro credit aspect of the economy with the launch of the N50 billion Micro Credit Fund. Dr. Goodluck Jonathan, the nation’s Vice President who represented President Umaru Musa Yar’Adua at the 3rd Annual Microfinance Conference and Microfinance/Entrepreneurship Awards organized by the Central Bank of Nigeria in Abuja, said that it was in recognition of the fact that access to finance is a powerful tool for moving people out of poverty into economic prosperity that the Federal Government launched the N50 Billion Micro Credit Fund (MCF).

While declaring the conference open, the President in his address, commended the CBN for the implementation of the Microfinance Policy, Regulatory and Supervisory framework launched in 2005, he noted that other similar measures adopted includes the 7-Point Agenda and several economic reforms.

The Governor of the CBN, Professor Chukwuma Soludo, in his address, underscored the effects of the current global financial crisis and highlighted the need for microfinance banks to re-position for better service delivery to their target clientele. He noted that in spite of the financial meltdown, the CBN is still committed to maintaining the value of the Naira, stable exchange and single digit inflation.

He reiterated the commitments of the CBN to the development of the microfinance sub-sector through the strengthening of regulatory frame-work capacity building like the introduction of the Entrepreneurship Development Centres and Certification programme for the operators of MFBs and the release of guidelines for the establishment of the credit bureau, Deposit Insurance, Agricultural Credit Guarantee Scheme (ACGS) and Interest Drawback Programme (IDP). Professor Soludo called on state and local governments and high net worth individuals, to establish MFBs, especially, in view of the un-even distribution of MFBs nation-wide.