Nigeria’s frontline economist, Prof. Pat Utomi, has applauded the Asset Management Corporation of Nigeria (AMCON), for effectively averting what would have turned out to be a major crisis in the banking sector in 2009/2010.
Utomi, who expressed reservation over the decision to publish names of their debtors of banks on the pages of newspapers on grounds that it was an abuse of banker/client privileges, cautioned that managers of the economy should learn from past mistakes, as some of these actions have a way of boomeranging in the future.
He recalled that AMCON had had to recapitalize five of the CBN-Intervened banks during the crisis, creating enabling conditions for subsequent mergers with other banks “or further capitalization by financial investors, which also and very importantly- ensured that no depositors lost any funds.”
On the way forward, Utomi noted that what was more important at the moment, was consistency as well as bringing more competence and passion into the issue of the economy and polity in general.
“I think that in many areas, AMCON has done a decent job even though the deal is still out. I think we need to understand more fully the dimension of systemic challenge, I don’t think we have fully educated ourselves – many of us comment on things and sometimes, it leads us into making very short-sighted commentary.
“Today, banks are publishing lists of debtors – the most silly thing. Nowhere in the world is it done; the banker customer relationship is like a lawyer/client relationship; doctor/patient relationship.
“10 – 15 years from now, you will see very talented entrepreneurial types who will not want to go near a bank because they are afraid that if a risk goes wrong, they will be portrayed as criminals,” he added.