EFCC recovers 171 billion naira from bank debtors

Nigeria’s anti-graft agency said yesterday that it had recovered more than 171 billion naira (1.1 billion dollars) from the bad debtors of banks whose chiefs were recently sacked for maladministration.

Femi Babafemi, spokesperson of the Economic and Financial Crime Commission (EFCC) told AFP the 171 billion naira out of a total loan portfolio of over 700 billion is a “substantial recovery of funds that were lost to individuals.”

“The recovery efforts have yielded good result,” he said adding: “We are still looking forward to getting more.”

Mr. Babafemi said the funds were recovered from debtors of seven of the eight banks which the country’s central bank said had been on the verge of collapse were it not for its recent intervention.

The central bank then announced a total of 600 billion naira (four billion dollars) bailout for the banks in “grave situation”.

The Central Bank of Nigeria’s governor, Lamido Sanusi has since August dismissed the chief executives of eight banks and charged them with fraud and doling out loans without collateral, in one of the worst banking scandals to hit the sector since a 2006 clean-up exercise saw 89 banks consolidate into 24.

The central bank had initially put the total loan portfolio of the ailing banks at 2.8 trillion naira. But EFCC spokesman said reconciliation had shown that the figure was just over 700 billion naira, as some of the figures declared by banks had turned out not to be loans.