Audit Report: CBN ready to sack three bank chiefs

arring a last-minute change of mind, the Central Bank of Nigeria (CBN) will release the second leg of its Audit Report of banks today.

Three banks may be in trouble for insider abuse and huge portfolio of non-performing loans, it was learnt last night. Their managing directors may be asked to step aside.

The 14 banks awaiting the CBN Audit Report are: Zenith, Bank PHB, First City Monument Bank, Standard Chartered Bank, Spring Bank, Access Bank, Wema Bank, Equatorial Trust Bank, Skye Bank, Ecobank, IBTC, Fidelity Bank and Citi Bank.

Of the three banks, two have recently mergd. The third has links with a telecommunications giant, according to sources.

CBN Governor Sanusi Lamido Sanusi and his management team finalised recommendations on the last segment of the Audit Report on Thursday after a 24-hour marathon meeting in Abuja.

A source, who spoke in confidence with our correspondent, said: "The CBN management has been meeting in the last 24 hours on the recommendations on the observations of the Audit Team on the 14 banks.

"There are strong indications that the report might be released on Friday because the anxiety over it has been hampering banking activities in the country in the last few months.

"I also think that three banks might be affected following their unjustifiable huge portfolio of non-performing loans and insider abuse.

"There is likelihood that the managing directors of the three banks might be asked to step aside."

Responding to a question, the source said: "The banks would have been more but the CBN had to weigh a lot of factors and indices."

The source confirmed that the CBN might change its method of releasing the report.

He added: "I think this time around, the CBN may adopt a different approach to the release of the report. For instance, the apex bank has been engaging the boards of some of the banks on how to apply the recommendations without any shock.

"When our examiners completed their assignment in the 14 banks, they had exit meeting with their management on their observations.

"So, all the affected banks have fair insight into the findings of the examiners."

The highly-placed source in the apex bank added: "The report is going to be much better than the previous one. It is likely to be a corrective report.

"For instance, if a bank needs to recapitalise, the CBN will say so without necessarily wielding the big stick of taking over such a bank."

No CBN official was prepared to speak on the release of the report today.

A source, who confided in our correspondent, said: "Very, very soon, we will release the report. We are still meeting on the findings; it is too early to give you any date. There is no cause for alarm.

"I think the CBN may issue a statement, instead of an elaborate press briefing. The names of the debtors might also not be made public as the case with the first report."

It was, however, learnt that the release of the report followed the submission of brief on the Audit Report on the 14 banks to President Umaru Yar’Adua.

Sanusi on Tuesday briefed President Umaru Yar’Adua on the findings of the apex bank.

The President is believed to have been consulting his Economic Team on the findings of the management CBN.

The briefing at the Villa followed the exit interaction between the CBN Examiners and the management of the banks on the observations of the audit team.

Some sources in The Presidency confirmed the briefing.

A source, who pleaded not to be named because of what he described as the sensitivity of the matter, said: "Sanusi has briefed the President on the latest audit report on banks. The President is still studying the findings of the CBN.

"I think the President has been meeting with members of his Economic Management Team on the findings and their implications for the economy.

"A few think-tank in government too have also been put into confidence in analysing the findings of the CBN.

"I cannot say when the President will get back to the CBN on his views on the report. But the nation should be hopeful that the report might be made public soon."

Asked whether the report has been tabled before the Federal Executive Council, the source added: "All I know is that issues in the report are already being appreciated by the Presidency, including cabinet members."

The CBN leadership has been discussing the report with the Chairman of the Economic and Financial Crimes Commission, Mrs. Farida Waziri.

They are said to be thinking of debt recovery ‘without any jolt’ on the economy.

A source said: "You know that Sanusi and Mrs. Waziri met recently in Saudi Arabia on the latest findings. There might a change of tactics in the release of the report this time around.

"Even the Presidency is aware of the new modalities for the release of the latest audit report."

There has been anxiety among the 14 banks over their fate.

A source said: "Some of these banks have been eager to know the contents of the full report but the CBN has been reassuring them that they have no cause to worry at all.

"In fact, as at Wednesday evening, the CBN management was still meeting on the findings and taking time to allay fears."