“Sanusi could easily be described as probably one of the most controversial central bank governors that we’ve ever had. And he came into the Nigerian banking space at a time when the banking industry definitely required a reformist, as a person sitting at the helm,” Femi Oladehin, partner at Argentil Partners, told CNBC Africa.
In spite of tracing and publicising misconduct within state-owned companies and within local banks, Sanusi’s tenure since taking office in June 2009 has created frameworks that will continue to prop up one of Africa’s biggest economies.
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Nigeria’s cashless policy, which was one of the many reforms under Sanusi’s belt while in office, plays a particularly key role in encouraging Nigerians to opt for either bank-related or electronic transactions. This is especially as a number of countries in the continent, including Nigeria, are still primarily cash-based.
According to a 2011 annual report by the Central Bank of Nigeria, of the payment channels in Nigeria that year, 85 per cent were cash-based, followed by 14 per cent via cheque, and one per cent via online channels.
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The implementation of the cashless policy is also in line with Nigeria’s vision 2020 goal of being amongst the top 20 economies by the year 2020. It’s also expected to be another means of eradicating corruption.
“We’re coming from a history in which [rich people] never go to jail. People who are rich are never asked questions. People believe that if they have enough money, they can bribe their way out of every situation,” said Sanusi at the 16th Nigerian Economic Summit in 2011.
Sanusi’s major reform came in the form of the country’s banking industry reform. Apart from ridding of managing directors and executive directors of banks such as Oceanic Bank, Union Bank of Nigeria and Afribank Nigeria, Sanusi also provided the banks with a 400 billion naira bailout.
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Twenty-two managing directors were thereafter indicted for fraud and reckless lending.
Oladehin added, “The reality is when you look at the rot in the industry at a time when he came, and what he had to do or what he had to face as a central bank governor, you could easily say that Sanusi single handedly saved the Nigerian financial system from imminent collapse.”
“If some of those banks had been allowed to die naturally, like most people expected, it could easily have taken out into our financial system.”
Under Sanusi, the Central Bank of Nigeria also implemented the removal of arbitrary bank charges on banking services, and drafted the Revised Guide to Bank Charges benchmarking lending rates to Monetary Policy Rate (MPR).
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Sanusi added while at the summit, “We have removed eight executives, we are trying CEOs. We have put one of them in jail. We’re going to put more in jail. In Nigeria, we have 260 people before the investment securities tribunal. Nigeria has done more to hold people and individuals accountable for this crisis than any country in the world”.