How Soludo frustrated our efforts to save Bank of the North – Alhaji Umar

Alhaji Abdulrahman Umar was the first indigene of Kano State to earn a Higher National Diploma (HND), which he did at the Newcastle Polytechnic in the United Kingdom. In this interview with Sunday Trust, Alhaji Umar said his 46 grandchildren and relatives are the ones keeping him busy in retirement. Being a retired banker, he […]

Alhaji Abdulrahman Umar was the first indigene of Kano State to earn a Higher National Diploma (HND), which he did at the Newcastle Polytechnic in the United Kingdom. In this interview with Sunday Trust, Alhaji Umar said his 46 grandchildren and relatives are the ones keeping him busy in retirement. Being a retired banker, he also spoke on the sector, especially how the North is faring.

How come you’re the first indigene of Kano to earn a Higher National Diploma?
I was born on April 19, 1948 in Kano at Farm Centre. I started my Junior Primary School in Fagge in 1954, which I completed in Dandago in 1958. From there, I proceeded to Rano Senior Primary School where I completed my primary school education in 1950. After the common entrance examination, I got admission into Technical Institute, Kaduna, the commercial section. Usually, it is a three-year course, two years Junior Commercial Certificate and one year Senior Commercial Certificate. The senior level certificate was equivalent to O’level. But it was designed to produce clerical officers dealing with finance and other areas for the Northern Nigerian government at that time.
The technical school later became Kaduna Polytechnic. After the three years, it was common that at that time once you are the best in the class, you automatically get a scholarship from the Northern Nigerian government. Of course, before then I worked at the Northern Nigeria Development Company (NNDC) for a short period of nine months before I was able to get the scholarship.

Where did the scholarship take you to?
The scholarship enabled me to go to the United Kingdom to further my studies, but of course, as you know, the technical school that I attended is more or less an ordinary level. So, one has to do some courses to qualify for admission to tertiary institution. So the first college I attended is Minster College of Council, Newcastle. After completing that, I went to Newcastle Polytechnic where I obtained Higher National Diploma (HND).
There was a problem when I came to Nigeria with that qualification. In fact, I was the first person in Kano state with HND. They don’t know where to place me, whether as a graduate or below. So, a lot of correspondences between the Ministry of Establishment, Kano and their federal counterpart on where to place people like us took place. But eventually they decided it is equivalent to a degree and changed my designation at the particular time.
After the HND, I came back to Nigeria in 1970 and started work under Cooperative in the new Kano state government. I was employed as a cooperative officer, because they didn’t know where to place me. But after the correspondences with the Civil Service Commission and the Ministry of Establishment, then the Permanent Secretary called me and said we got this issue from Lagos that you will be placed on grade A, which is equivalent to a graduate. There was this level of transparency then; they always let you know what affects you.

When you started working, how far have you gone?
I worked for 11 years in the state government from 1970 to 1981. But in the interim, I got an admission; a kind of in-service course to do a Masters in Public Administration in the United States at John F. Kennedy School of Government, Harvard.
When I came back in 1981, the situation was quite different. The politicians were in power, but when I left it was the military. So, it was quite something else. Actually I found it difficult to work with the new government, maybe it was because of the new things I learnt with the expectations of what the government needed to do for the people, but the politicians were more concerned about other things.
So, I started to look for employment and I got one at Ahmadu Bello University (ABU), Zaria in research and consultancy and another one from International Bank for West Africa (IBWA).
That time I had applied for this piece of land (reference to where his house is), so I said if I am able to get this land I will go to the bank and build the house. If I am not able to get the land I will go to ABU, Zaria because they will accommodate me and give me a house.
So, eventually I was allocated this land. Interestingly, that time they had state rules, which they followed strictly. The person who gets allocation of land should be a resident of where the land is located. So, I was given the first option, and that was why I shifted more towards going to the bank than going to ABU.
I started working with the Bank from 1981 up to 2002. I started as an ordinary manager; they called it level five at that time. Then I became branch manager in many places; first in Zaria, Maiduguri, Kano and then Kaduna. I served in all those places. Then of course I was promoted from that rank to different levels.

Did you retire at the bank in 2002?
Yes.

Since you spent most of your working years at the bank, how would assess development in that sector?
To me the big issue is the raising of share capital from N1 billion to N25 billion during Soludo. It is quite natural for business to grow on their own, but that kind of growth, to me, was inappropriate because it created a lot of problems, which I will explain later.
But the biggest problem is that, it provided an opportunity to people to launder and steal money. That actually led to people of dubious characters getting control of those banks, especially from the oil rich states where they have super allocations of federal money. The second problem is the capacity of the banks’ management.  You have a small bank of a share capacity of N1 billion, then suddenly you have a bank of N25 billion. Therefore, there were no qualified human resources to manage those banks, and that was why I wasn’t surprised when eventually problems came up later.
 The chief executives that emerged were from smaller banks, so they didn’t have the capacity to manage those big capitals. In banks, before the universal banking concept, you had the investment banks and commercial banks. Investment banks are wholesale banks, they dealt with big customers of different categories, while the commercial banks dealt will all kinds of customers.
So, the experience to manage the bigger banks will come from the commercial banks; those people with commercial banking background. But what happened that time was that you had people from investment banks managing those big banks. If you recall, when they exposed those who defaulted, they were few in number, but the amounts were huge. They were given extensively huge amount of money beyond what they could defend.
The second problem is the capacity of the CBN to manage the banks. The capacity to supervise these banks, because it’s like giving somebody who is repairing a small car a big lorry to manage. They didn’t have the capacity and they don’t know how to supervise those banks, and that led to a lot of problems in monitoring the effectiveness of those banks. And that was why when later Sanusi Lamido Sanusi took over, he discovered a lot of problems.

How did the banking consolidation affect Northern Nigeria, especially?
Well, from my experience, we are always concerned about the balance of ownership in any bank. And we do a lot of things when allocating shares so that you have an equity balance in the country without one section of the country dominating another. But when you have people in a hurry and they have a lot of resources at their disposals, they encouraged banks to be privatized so that they can take over. And I think Soludo was rushed into taking that kind of decision to expand the share base of these banks, and that provided them with the opportunity to launder stolen money.

Then, how would you assess the reforms introduced by the present Emir of Kano?
When he took over, the imbalance was still there. There were 25 mega banks owned by certain individuals from one particular region of the country. And there is nothing he can do about that. Another problem, which he found, when you make investment; you invested N25 billion in a bank, and there are other areas of the economy that required investment. This is what the economics called crowded investment, which would have been shared to other sectors of the economy.
During the consolidation, Bank of the North did not make it to be one of the 25 banks. Of course, Bank of the North was one of the banks that made it to form the Unity Bank of Nigeria. I was involved in the committee the state governments formed to look into how the bank can be saved. We wrote a report on how to save Bank of the North, but the then governor of CBN, Soludo, was not interested in supporting the existence of the Bank of the North, because it was later found out that the amalgamation of six banks that formed Spring Bank, now Enterprise Bank, five of those banks that were merged had problems before the merger. They were not even operating, they were not opening for businesses, they had a great loss, but the CBN approved the merger of those banks. Only one of those banks was operating, but he accepted them to merge together and formed an entity.
Honestly, I believe there was a deliberate attempt to make sure that the North doesn’t have a bank. So, when the new governor of CBN was appointed, I wrote a congratulatory letter to him and I mentioned that what he will find in those banks will surprise him. He indeed found those problems, and the world has seen what happened with some of the executive officers.

You said you retired from the bank in 2002. What position did you occupy at the time?
As I said earlier, I held several responsibilities in the bank (Afribank). One of them was branch manager as I mentioned earlier. Area Manager in Abuja, Kaduna and Kano, Regional Manager in Abuja, Assistant Chief Inspector of the bank and representative of the bank in our offshore company in the Republic of Ireland where I spent two years. So, when I came back to Nigeria after a while, the board appointed me as an Executive Director, which I served for six years, from 1996 to 2002 when I retired.

Then how is life in retirement?
Two years of those 13 years of my retirement, I served in Spring Bank as an Executive Director. But in the interim, I was running a fish farm in Jogana, which I called Jogana Fisheries Limited. I also have a lot of interest in writing.

Since you have interest in writing, how many books have you written?
Well, I didn’t write many books. I wrote one book, and the first draft of it is in Hausa, I am now translating into English, because I felt our people should have the first opportunity to understand the book.

The book is about what?
Emergence of State, The Process of Economic Development. The book is about how state develops, from one stage to another, following European example and what led to industrialization. And why things are not working here and why there is insecurity in the world, why there is insecurity in Nigeria and why the political system is not working in Nigeria.

You said the first draft is in Hausa, what is the name in Hausa?
Gwagwarmayar Tasowar Kasashe. The Hausa version is not yet in the market, but it is almost ready.

When are we likely going to get the two versions of the book?
My intention is as soon as I complete the translation, which I have gone, I will release them. The Hausa version is about 600 pages, but the English version may be much higher that probably I am to consider doing it in two volumes.
Actually one of the things that worried me is the insecurity we have in Nigeria, and globally. These things worried me a lot that I did a lot of work on insecurity. For instance, you have military industries producing aircraft, tanks and weapons; you can’t make money if you don’t sell them. So, if there is security you cannot sell those things, and these industries are owned by private individuals.
All these weapons that are used in Nigeria are not manufactured in the country. Certainly, the local Malams in Maiduguri cannot produce those weapons that are killing people, not to talk of the bombs. With my two degrees, I cannot operate a gun, but they can do it, and they have not gone to school.
In bank, the best person to lend money to is the government. When the government is destroyed, then there is no future. Every single day America spends $200 billion on interest payment. And what are they spending the money on? Arms, because they had to do a lot of things in the world; put their troops in different parts of the world to control resources.
And I don’t think the insecurity here is home-grown, because there are lots of political stories that can explain what is actually happening. You create Boko Haram and then it creates reaction, and then eventually you suggest a solution. And usually the solution may come in the form of giving you security. So, I am sure when eventually these issues come to light, like they have done in so many other cases, the bombings done during communist period, when intelligence agencies put bombs in schools, colleges and whatever places and blamed them on communists, we would come back to our senses.
There are activities done by the Central Intelligence Agency (CIA) and MI6, so there are a lot of issues that are happening that people don’t understand, and really this thing worries me a lot. And this was why I am worried that those countries that have greater interest in our country will prefer the lousiest person in the world to be our leader, and that worries me a lot.

Apart from writing, what do you enjoy doing in retirement?
I enjoy having association with my family and friends. I have a very large extended family. I have 46 brothers, sisters and grandchildren, who keep me busy. Being the most senior person in the family, it keeps me busy and occupy my time fully.