2nd April, 2014
Barring all unforeseen circumstances, Zenith Bank Plc Managing Director, Mr Godwin Emefiele, will in June this year be sworn in as the new Governor of the Central Bank of Nigeria, CBN. He will take over the leadership of the apex bank from Mallam Sanusi Lamido Sanusi who is currently fighting his suspension from office. Emefiele, an astute banker of over 24 years experience, was chosen from a list of top bank CEOs. He has since been confirmed by the Senate.
That Emefiele is the right man for the job may not be in doubt. His efforts in taking Zenith Bank to the enviable height it stands today clearly speaks volumes about his professional competence. But the leadership of the CBN is a different ball game that would certainly pose challenges to the governor-designate.
On assumption of office, Emefiele will be expected to continue and possibly build on the successes recorded by his predecessor, especially in attaining a workable monetary policy, banking reforms and the cashless policy.
While it could be argued that Sanusi’s policies may not have all been the best, the in-coming governor must not be in a hurry to implement new ones. If necessary, Sanusi’s policies could be reviewed but not outrightly discarded. The successes which Sanusi achieved should be consolidated upon and not discarded. Continuity should indeed be the new order.
The country’s currency and external reserves have not been on very sound footing in recent times. While the naira has continued to slide against the US dollar, even as it is officially said to exchange at N155.75 per dollar, Nigeria’s external reserves have steadily dropped from about $50 billion mid last year to its present balance of less than $42 billion. Emefiele will therefore need to introduce more proactive measures, including further tightening of the Cash Reserve Requirement (CRR) on public sector bank balances to help stabilise the naira in order to raise the nation’s foreign reserves.
The introduction of a cashless policy will, no doubt, stand as one of the remarkable accomplishments of the CBN under Sanusi. Although the policy had taken off in Lagos, the FCT and five other states, before Sanusi was booted out of office, Emefiele now faces the task of implementing the policy nationwide as from 1 July.
Related to this is the $50 million biometric solution project which was inaugurated by Sanusi six days before his suspension. The project aims at building a central database of bank customers in the country. Luckily, Emefiele previously served as chairman, Biometrics Subcommittee of the Bankers’ Committee. This would hopefully spur him to pursue the project with zeal.
The in-coming CBN governor must also avoid controversies and concentrate on the core regulatory mandate of the CBN as stated in the CBN Act to maintain the external reserves of the country; promote monetary stability and a sound financial environment; and to act as a banker of last resort and financial adviser to the Federal Government. He must also work hard to win the confidence of investors and the banking public.
The position of CBN governor is not supposed to be used for politics. It is not a passport to reckless unappropriated spendings. As a public servant, Emefiele must not fail to work within the ambit of the law.
Like the other CBN governors before him, Emefiele’s new office properly positions him to expose corruption and ensure strict supervision of the nation’s banking industry, even if to reassure both local and foreign investors. He also stands the chance of engaging in a more progressive trans-central bank relations with other nations. We expect Emefiele to build a good working relationship with all the stakeholders in the banking sector, the Federal Ministry of Finance and the Presidency to turn around the economy.