WARNING: This is Version 1 of my old archive, so Photos will NOT work and many links will NOT work. But you can find articles by searching on the Titles. There is a lot of information in this archive. Use the SEARCH BAR at the top right. Prior to December 2012; I was a pro-Christian type of Conservative. I was unaware of the mass of Jewish lies in history, especially the lies regarding WW2 and Hitler. So in here you will find pro-Jewish and pro-Israel material. I was definitely WRONG about the Boeremag and Janusz Walus. They were for real.
Original Post Date: 2010-04-06 Time: 00:00:26 Posted By: News Poster
By Kingsley Ighomwenghian
Lagos – Thirty banks may emerge on the financial landscape sketched by the Central Bank of Nigeria (CBN) in the planned phasing out of universal banking.
A total 24 currently operate, with the top seven dominating as an oligopoly. Among the banks are subsidiaries of international players.
A CBN source disclosed at the weekend that the system may end up with six international and development/specialised banks each (including at least two Islamic banks) and 18 regional banks.
National banks may be yanked off altogether, as they are believed to be susceptible to abuse by politicians, just as most of the banks’ far flung branches are seen as their albatross due to poor monitoring.
How a bank is categorised will be determined by how much capital it has, unimpaired by losses, beside adherence to good corporate governance.
Banks with branches abroad, mostly across Africa, include Acces, Intercontinental, Diamond, Union (with Banque International Du Benin), Guaranty Trust, Oceanic, First Bank and United Bank for Africa (UBA).
Both First Bank and UBA also have branches outside the continent.
While international banks are expected to have N100 billion shareholders funds, besides governance of international standard, Islamic banks may be required to have about N10 billion capital.
CBN Governor Lamido Sanusi explained on Channels Television on Saturday that a document on the phasing out of universal banking is being studied by the banks, which are to make their inputs before implementation.
He lamented that under the guise of universal banking, several banks used their capital to set up subsidiaries even when they had little or no knowledge of the challenges in a particular field.
The banks, he noted, exploited a clause in the Banks and Other Financial Institutions’ Act (BOFIA) to stretch their capacity beyond their limits, and in the process put their capital and depositors’ funds at an unnecessary risk.
Nigerian banks have about nine subsidiaries, most of them becoming drain pipes soon after establishment until the bubble burst.
They set up shop in areas such as insurance, capital market, asset management, stockbrokerage, mortgage banks, microfinance banks, and registrars.
Sanusi noted that several opened off-shore subsidiaries without guidelines from the regulators.
For them to retain their international branches, he said, they would have to have more capital than others, and subscribe to the International Financial Reporting Standards (IFRS), world class governance, as well as risk management, and control standards like international banks such as HSBC, among others.
A bank’s capital would be tied to the level of risk it is prepared to take, he added.
While many kick against the phasing out of universal banking, introduced by Joseph Sanusi as CBN Governor about 10 years ago, some argue that the concept has been abused.
There used to be strict walls separating commercial and merchant (non-deposit taking) banks. But merchant (investment) banks sought to mobilise cheap deposits, because they could not effectively compete for deposits from the public.
The CBN, which Directors recently arrived from a tour of Malaysian financial institutions, including its Central Bank, hopes to replace the licences for universal banking with those that would enable banks operate as international, regional, development or Islamic banks.
Original date published: 4 April 2010
Source: http://allafrica.com/stories/201004050698.html?viewall=1