Imo State versus Zenith Bank

Banks exist as a Business to make money guided by Central Bank of

Nigeria's regulations.

The one area Banks have targeted to my surprise is politics. I once came across a report of a Bank bankrolling a Politician and then planting their staff as a commissioner in order to ensure their money is repaid.

The case of Imo State and Zenith Bank has come to the fore. There are two possible scenarios.

One is if Zenith Bank did lend money to the State Government.

Second is if the money was Lent to an individual to contest Elections.

In the first scenario, the Bank is duty bound to take steps to ensure it's funds are repaid.

The matter wears a different toga in the second scenario, where the money cannot be said to be Lent to the state government.

The process of granting a credit is so elaborate that the matter between Imo State Government and Zenith Bank should not have  arisen.

What I suspect is that the money could not be said to have been Lent to the state government, so the finance committee of Imo State is now capitalizing on that point.

The head of the committee was a Boss of the Debt Management Office of Nigeria.

I sympathize with Zenith Bank and hope they as well as other banks learn from the saga.

What I suspect strongly is that if the money was Lent to an individual, the loan document would not be straight forward or could be such that it is saying one thing but in reality it means another thing.

Should Zenith fail to recover their money, the loss would really be that of the shareholders.

An angle to the matter that interests me is the possible intervention of the Central Bank of Nigeria. Be it known that the Governor of the Central Bank, was the Chief Executive officer of Zenith Bank.

I doubt if he would be fair in the matter granted that he was an employee of Zenith Bank.

I personally do not feel comfortable with the idea of recruiting Governors of the Central Bank of Nigeria from commercial banks.

It will really be difficult for them to be fair minded.

The case of Sanusi Lamido Sanusi comes to the fore. Two things were against SLS apart from being from a Bank.

He was a risk Manager and a socialist of sorts.

His legacy was as divisive as his non conformist dressing.

Back to the matter at hand. Zenith Bank should ask for an amicable settlement. Imo State should look more in the direction of the courts than the Central Bank.

The courts can compel the Central  Bank to carry out it's judgement but the Central Bank as presently constituted cannot be said to be positioned for a fair decision in the matter at hand.