The Committee of Banks’ Chief Executive Officers in Nigeria has moved against bad debtors, who they accused of smear campaignsagainst banks and their chief executives.
In a statement, the group said the affected debtors are not ready to repay their loans.
The group spoke in Lagos after reviewing what it called the “harassment and criminalization of banks’ CEOs by law enforcement agencies”.
It noted that chronic bank debtors are now in the habit of enlisting law enforcement agencies including police, judiciary and state security to harass and criminalize banks’ CEO, saying this is unacceptable.
“Notably, these loan defaulters are known to have abused court processes as well as using social media to propagate their smear campaign against the banks,” the group said.
A communique issued following the meeting noted that these activities by the law enforcement agencies and the bank debt defaulters are capable of adversely affecting the banking system vis-à-vis the CEOs reputation amongst international banks, destroy the economy, and called for these to be checked and managed.
In order to tackle what they see as an emerging threat to banking business in Nigeria, the committee, therefore, outlined a five-step resolution of actions that banks would need to take. The resolutions and planned actions were arrived at after members discussed and considered different options for dealing with the issue.
Specifically, the banks’ CEOs said there was an urgent need for all banks to cooperate and collaborate to identify and ex-communicate chronic debt defaulters, noting that.
“This goes beyond publishing names of such defaulters in national media (which is inevitable), but involves all banks speaking with “one voice” and sharing information about those entities, and refusing to do further business with them until they settle their obligations.”
To avoid the kind of crisis that rocked the banking sector 10 years ago, the CEOs urged all agencies and stakeholders to step up and help fight the inherent menace of chronic loan defaulters.
According to the CEOs, the banking industry is the backbone of the Nigerian economy, therefore, it is the responsibility of all stakeholders – regulators, police, judiciary, corporate organizations and media to help save it from activities of delinquent debtors.
Besides, the Group resolved that all cases of defaults would be presented and passed through the Bankers’ Committee Ethics Committee just as it intends to work with legal councils and come up with ways and strategies to manage related cases effectively without disrupting businesses and the system.