This is Nigeria; a very impressionable society with varied perspectives, some of which are unbelievable at best if not laughable. Series of theses have emerged on the recent sack of Directors of FBN Holdings and FBN Ltd, the Bank. However, this turn of things is not unexpected and it’s just because, again; this is Nigeria!
Author is both a student of law and an experienced business manager with sufficient professional practice and theoretical exposure to the banking & finance markets. However, this is not the best forum to consider the legal technicality of the subject events, that is both the saga that led to the sack of FBN boards and the limits of the power exercised by the regulator versus independence of the board. Therefore, the discussion here is limited only to the business and moral implications of the different events and stories out there, many of them unverified or difficult to accept hook, line and sinker. Notwithstanding, there are obvious similitudes of facts to rely on.
It is important to focus on the business and moral angles of the happening because businesses are first of all built around people and societies; and for them. Therefore, we cannot divorce morality or character of managers from their business motives of profits, growth, relevance and continuity. In strict professional business terms, it is called ethics. Perhaps at the other extreme of the law; empathetic and gentle, there exists ethics and the reign of ethical dealings for businesses to achieve sustainable profit maximization.
Lest some people infiltrate the market with their usual distortion and tribal bigotry, this issue is far from Emefiele versus Otudeko, neither is it Niger Delta versus Yoruba. It would be sinful for any discerning person to toll that line of argument. While the probability of personal issues is not zero when issues like this come to the public in Nigeria, the focus should be on the “available” facts and figures. In most cases, average Nigerians and even the most knowledgeable commentators do not have all the facts together. That is usually because, this is Nigeria, and more so because this had happened before, it will still happen again at least until further notice.
Now to the business and moral (ethical) views of things. CBN has only done what it should do in its role as the regulator. It sensed a foul play and swung into action. A bank MD was removed without recourse to the Central Bank comes across as very suspicious. There is no need for legal citations yet but the regulator in every system and society (like referees in soccer) exists to ensure things are done honestly and objectively. Still, this does not stop anyone from seeking redress against the regulator or seek fair judgment if they feel unfairly treated. If FBN has been so exposed to Honeywell with no or inadequate security whether by an omission or deliberate commission, it is difficult to understand why FBN as a bank did not act all these years and what CBN has been up to until now. The same Honeywell company is involved with Ecobank and the issue has been in court for some time. Maybe waiting this long to act was an error but a very arguable one.
Perhaps the error is neither of omission nor commission. Maybe it is an error of collusion; more like a conspiracy. It is not impossible that all parties involved (Honeywell, FBN and CBN) contributed to the error, or why has the same company taken advantage of two different banks (as much as we know) and the regulator for this number of years. From this side of the view, it is also difficult to know why each or if any of the parties connived and did nothing to prevent the problem from the onset or at least do something to correct the error much earlier. Maybe it was negligence, poor oversight or sheer recklessness but no one would accept to have been irresponsible at this stage more so because; … yes you are right… this is Nigeria!
There is no need to play the role of the court by attempting to lift the veil of incorporation; this writer assumes no prior knowledge of the ownership of Honeywell. However, that is the actual culprit and that entity is still in business. It made some profits recently and its share price appreciated by 10% while that of FBN Holdings plunged by 6.6% within twenty-four (24) hours. The most important questions to ask include the followings; “like Ecobank did; why didn’t FBN drag Honeywell to court?”; another question is “why did CBN allow a board member whose company erred to continue on the board of the bank for another 5 years after the problem was first noticed?”; more importantly, “did the board of FBN sack its MD truly because of this same problem that they have all managed amongst themselves for five years?”. It is uncertain but “if the bank’s position has improved as the CBN Governor claimed during the press release, what then is the crux of the current disagreement?” Are there other issues? What are the other likely issues? The questions are endless but it’s uncertain if anyone of those qualified to answer will oblige anyone of the rest of us. Therefore, it is over to individuals to discern.
Meanwhile; beyond CBN, FBN, Honeywell, Banking, Security, Health, Education and many of the other problems; at the ISM Lagos, we believe that businesses should reflect more morality than money, character not connivance, and that government should be of law rather than of men. When strong institutions serve the purpose of few individuals, they become simply extractive, weak and ineffective. Those institutions become subject to the few individuals and the individuals will indulge themselves as much as they can get away with.
Please join this and many other topics of discussion. Attend one of our courses today either online or offline, join our quality discussions and engage with other curious people to better understand those deeper issues while we reach better conclusions together
