The governor of the Central Bank of Nigeria, Mr Godwin Emefiele has reportedly dissolved Boards of First Bank of Nigeria, FBN Holdings and appointed new boards in replacement.

Premium times reported that the Nigeria’s Premier Bank, First Bank, has for years been plagued by “bad credit decisions, significant and non performing insider loans and poor corporate governance practices”, the reason why the Central Bank of Nigeria took the decisive regulatory decision.

The Banks and other Financial Institutions Act 2020 is the principal legislation that regulates and directs the affairs and operation of banking industry in Nigeria.  It empowers the Central Bank of Nigeria to oversee both the banks and other financial institutions in the Nigeria.

The CBN has exclusive regulatory and supervisory power over Banks and other financial institutions in Nigeria under part three particularly section 29 of the Banks and Other Financial Institutions Act 2020. For the sake clarity, section 29(1) BOFIA provides thus: Notwithstanding anything to the contrary contained in this Act or in any other document the Bank (CBN) shall have and exercise regulatory and supervisory power over banks, other financial regulatory and specialised Bank to the exclusion of any other agency or institution…

Consequently, the motive of this write up is to examine the powers of CBN over banks, their affiliated companies, other financial institutions and specialized banks, with special reference to commercial banks.

Why CBN dissolved the boards of First Bank of Nigeria, and FBN holding Plc? 

The summary of the reasons why CBN invoked its exclusive regulatory power in dissolving the Boards of First Bank of Nigeria and its parent company is as contained in the opening chapeau of this write up. At the expense of repetition, the reasons are “bad credit decisions, significant and non performing insider loans and poor corporate governance practices”. It can be reasonably concluded that First Bank heading towards becoming a failed bank which CBN must take actions.

Intervention Powers of CBN in Failing Banks

The Banks and Other Financial Institutions Act 2020 mandated CBN to intervene and salvage a failing bank, as contained in Part IV.  This shall be done by the CBN governor after a special examination or investigation of the affairs of the bank concerned has been carried out. This must be in the interest of the public, where the bank carrying on its business in a detrimental way, where the bank has insufficient assets to cover its liability and where the bank has been contravening the provisions of the BOFIA, as contained in section 33(1) a, b, c, d save paragraph e (i)(ii) where special examination would not be conducted.

Instructively to this article is the provision of section 34 BOFIA, particularly sub section 1 paragraphs a, b, c, and d and sub section 2 paragraphs a, b, c, d, e, f, g, h, and i. The community reading of sections 33 and 34 gives the CBN power to remove from office and appoints any director or directors of a failing bank as seen CBN governor exercised.

Thus as far back as 2010, the Federal High Court, Lagos Division was reportedly held that CBN Governor has statutory power to appoint and remove Bank CEOs. Proshareng  reported that Justice Mohammed Idris made this declaration while ruling on a case filed by some aggrieved shareholders of Union Bank Plc challenging the propriety of the appointment of executive directors into the board of the bank by Sanusi.

According to the judge, section 35( now section 34 of the new Act) sub-section (2) (d) of Banks and Other Financial Institution Act (BOFIA) gives the CBN Governor the power to remove or appoint not withstanding anything in any written law or contained in the memorandum and article of association of the banks.

In the words of the judge, “in my view by virtue of the combined effect of the provision of section 33 and 35 of BOFIA, the CBN Governor is empowered to order a special examination into the books and affairs of a bank. He can also intervene in the operation of a bank by removing and replacing the directors of a bank found to be in a grave situation; to hold otherwise is to impair the legislative intent underpinning the provisions, which is the ability of the CBN Governor to provide a failing bank with necessary managerial and operational support to facilitate the bank’s turn around.”

It is submitted, that the holding of the Learned judge is in tandem with the view of this writer as expressed in paragraph 8 of this write up.

It is highly regretted that this writer could not laid his hand on the above case due to the limited materials available as at the time of conducting research on this write up.

Concluding Remarks

The banking industry no doubt occupies a pervasive role in financial system of any nation and therefore banking business must be highly regulated.

It is amazing and this shows that the government can still get things done. Anambra state governor, Willie Obiano, has put his name in the record books. I know why because he has delivered as promised: 15 months and Nigeria’s widest runway airport is born. When we talk of economic opportunity, this is what we are talking about: infrastructure. Get the Ibom Deep Seaport going, and the economy of Nigeria will add few points.

I want to congratulate all the good people of Anambra state for this accomplishment, not just for having a new airport, but doing it when every state government receipt disappears in “security votes”. Una don do well.

Tekedia Fellow John Mc Keown looks into this good news from Nigeria:

“Chairman of Air Peace, Mr Allen Onyema “…What we have here is the widest runway ever (in Nigeria) ..and could land a Boeing 777 and an Airbus 380.’ He described the new Anambra Airport as ‘an ambitious project initiated by Gov. Willie Obiano which has recorded impressive execution in 15 months…Being the newest airport in Nigeria, Anambra International, of course, now has the most cutting edge technology in airport management currently available.”

Nigeria, congratulations. Let’s build our infrastructures and get this country going.

According to the News Agency of Nigeria (NAN), two aircrafts; Boeing 737 mark N5,-BUJ, and Embraer 145 belonging to Air Peace Airline landed by 2.26 pm and 2.46 pm respectively, yesterday April 30, at Anambra airport.

Chairman of Air Peace, Mr Allen Onyema “…What we have here is the widest runway ever (in Nigeria) ..and could land a Boeing 777 and an Airbus 380.’ He described the new Anambra Airport as ‘an ambitious project initiated by Gov. Willie Obiano which has recorded impressive execution in 15 months’

Length of runway isn’t the only important variable, width is important too, and also influences types and sizes of aircraft capable of using an airports’ services.

None of the runway lengths in airports in Nigeria come close to any global or for that matter, even African leaders. The ‘gong’ for the longest runway in the world is a tie between Shigatse Peace Airport (China) and Ulyanovsk Vostochny Airport (Russia), both 5km (5000m)

Nevertheless, with the advances in Aviation Design Technology, modern commercial airports don’t need to be that long.

Airbus A 310 was the first commercial aircraft to have a ‘wingtip fence’ in 1985 which was the precursor to the modern ‘winglets’ ,  ‘sharklets’ and ‘raked wingtip’ designs. While the main benefit of these innovations is reduction in fuel costs and extension of long haul range, they also allow a commercial jet to start descent far earlier, and land comfortably on a shorter runway.

Having a good location – air current behaviour, terrain, altitude, etc,  comfortable runway width, good runway build quality, and the latest available technologies are far more important than winning a ‘mine is bigger than yours’ game with runway length.

Russia and China to a certain extent are where US were in the ’50’s and early ’60’s with this notion of quality improves with increased size… but  biggest isn’t always best.

Margaret Ekpo International, Calabar, whose best runway is 2450m, is able to comfortably accommodate even the largest of the commercial airliners in popular usage, which have been built in the last ten years.

Unless you have plans to land strange six engine Russian or Chinese behemoths, extra runway is expenditure that can be better invested in aviation support technologies in, perhaps the tower.

At the turn of the millennium a plan was afoot for an airport in Osun State which would have broken the 4km line for a Nigerian runway. Unfortunately the local bid grantee AWOL, didn’t get the funding to proceed with the project due to their Turkish partner, Biray Group.

As the relationship between the partners continued to further break down, the local company became increasingly uncontactable by reporters and other local ‘interested parties’… with a name like ‘AWOL’ – it is something you couldn’t make up!

Being the newest airport in Nigeria, Anambra International of course, now has the most cutting edge technology in airport management currently available. Being based in Umueri , it is striking distance from active O&G sites, the river Niger, and many surrounding states, so it will bring huge benefits not only to Anambra but to the region.

References and Acknowledgements:

• https://en.wikipedia.org/wiki/List_of_airports_in_Nigeria
• Air Peace makes history, lands in Anambra Airport – P.M. News (pmnewsnigeria.com)
• https://rh.gatech.edu/news/62371/new-design-would-let-commercial-jets-use-shorter-runways
• www.premiumtimesng.com/news/headlines/280924-investigation-why-osun-mko-abiola-airport-failed-2.html
• taketotheair.com/future-aircraft-technology/
• https://aertecsolutions.com/en/2019/02/11/the-length-of-a-runway/
• https://tamarackaero.com/insights/2021/03/10/dr-byron-k-lichtenburg—detailed-evaluation-of-active-winglets
• https://en.wikipedia.org/wiki/List_of_longest_runways
• https://en.wikipedia.org/wiki/Wingtip_device

Good People, we have already done better than most Nigerian states. Yes, you are aware of the National Bureau of Statistics which noted that 26 states in Nigeria did not receive any foreign direct investment (FDI) in 2020. Some of the outperformers included Adamawa state which attracted $20,000 (not a typo).

Tekedia Capital has already outperformed many of those states. Through our syndicate, we make it possible for anyone to invest in category-king startups in continental Africa. We estimate to inject $millions into generation-shaping companies in coming months. Learn more how to join here – Learn more on how to join here https://school.tekedia.com/tekedia-capital/. 

More so, innovators and founders, we want to meet you. Tekedia offers $25,000 Amazon AWS credit if you are building on AWS. I think we are one of the few entities in the world that Amazon chose to do that.  Send what you are building; we have access to resources to take you to the next level. Businesses must be tech-anchored and could be legally based anywhere on earth but must be majorly-operating in continental Africa.

Click here, watch our video and send your business plan/pitch deck to my team.

This video by a West African in China has been shared everywhere. Yes, Chinese teachers drive BMW, Mercedes Benz and other expensive cars. That is true. But he missed a critical point in that video: nearly 99% of those teachers did not pay cash (I mean pay at once) for those cars.

In the US, you can walk into any Volkswagen dealership, give them your social security number (like National Identity Number) and they run your credit, and within an hour, you can drive out with most models. It is called Sign & Drive which means you do not even need to pay anything: Volkswagen will allow you to pay over 7 years!

Teachers in Ghana do not have that choice: they have to pay at once. Sure, this is not to say that teachers in Ghana or anywhere in Africa are well compensated. My point is this: if you allow most teachers in my village school alma mater – Ovim Community School, Abia State – to pay over 7 years for at least second hand cars, they have a chance. Today, that is not possible as they must pay 100% on delivery.

So, context matters. Ghana and indeed Africa need a credit system to advance the wealth of the citizens.  That is why we need fintechs to innovate on the credit system in Africa.