CBN unveils scheme to check bank fraud
By Bukky Olajide
A NEW scheme calculated to check bank fraud was yesterday unveiled by the Central Bank (CBN).
Tagged Asset Management Company (AMC), it involves the installation of a data website, which will publish names of fraudsters, both past and present. Banks will thus be opportuned to check the names of potential customers or loan benefactors from the list to avoid transactions with fraudsters.
CBN Director of Banking Supervision, Mr. Ignatius Imala, disclosed this yesterday while briefing the press after the bankers' committee meeting in Lagos.
According to him, AMC, which is to check the high incidence of fraud and non-performing loans, will be managed by both the CBN and the Nigerian Deposit Insurance Corporation (NDIC).
Cases of bank fraud have dented the country's image while non-performing loans and insider credits have wrecked havoc in the entire banking sector.
Imala disclosed that the apex bank had already sent a bill to the National Assembly to give legal teeth to the AMC.
This, according to him, will enable the CBN to retrieve non-performing loans. He said that though provision will be made for banks to buy shares in the future, the company will be managed solely by the CBN and the NDIC for now.
Imala explained that the publishing of names is first to protect banks from fraud and secondly to serve as deterrent to potential fraudsters. The director also gave more insight into the issue of bank mergers.
According to him, contrary to insinuations that government is aiming at creating 12 or 15 banks, the CBN has never arrived at any number.
"The most important thing", he said, is "for banks to arrive at the minimum capitalisation after merging. It is the number of banks that merge and that have arrived at the specified amount that will be allowed to operate. We will not determine the number by fiat. Moreso, the CBN has never fixed any number of mega bank," he said.
Imala added that while 10 group of banks have submitted their Memorandum of Understanding (MoU) to the CBN, only five of these have actually signed.
This notwithstanding, he cautioned banks against too much publicity of the signing of their MoU, explaining that the banking public may not really understand that MoU is only an intention to merge not the real merging.
According to Imala, a bank may want to detach after signing an MoU, which may be okay but if it has publicised itself and then move on to sign an MoU with other group, it will go through the same publicity and the image of running from one bank to another will create problem.
The Managing Director and Chief Executive Officer of Oceanic International Bank Plc, Mrs. Cecilia Ibru, also speaking at the briefing added that cyber crime and financial security have constituted serious concern to the banking sector.
She also said that there is a new dimension to the issue of equity funding of the Small and Medium Enterprises (SMEs) as banks that are involved in it have agreed to set aside 10 per cent of the stipulated 10 per cent profit before tax by banks to fund real estate.
The Managing Director of Afribank Plc, Mr. Kashim Njidda, while responding to a question stated that nothing is wrong with banks going to the stock exchange to raise funds, afterall, "it is the already quoted banks that are doing this."
According to him, "even going to the market to raise money does not mean that a bank will have all the money it wants."` *****okay
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