Africa News blog
African business, politics and lifestyle
Nigeria’s central bank sliced through the hubris of the business elite with its $2.6 billion bailout out of five banks and the sacking of their heads in what looks as though it could be a new era for corporate governance in Africa’s most populous country.
Recently appointed Central Bank Governor Lamido Sanusi said lax governance had allowed the banks to become so weakly capitalised that they posed a threat to the entire system, and described the move as the beginning of a “restoration of confidence” in sub-Saharan Africa’s second biggest economy.
The 1.14 trillion naira ($7.6 billion) in bad loans run up by the banks is roughly equivalent to the combined annual income of the poorest 20 million people in Africa’s most populous nation, each of whom live on around $1 a day.
Yet the “Friday massacre”, as one newspaper dubbed it, set Blackberries buzzing in Lagos champagne bars not because of the breathtaking scale of the money involved, but because of the might of the corporate aristocrats felled by Sanusi’s axe.