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The Bankers Have Come To Judgement — By Anayo M. Nwosu

Peter the Rock, as we, his close friends know him, kept calling me yesterday while I was in a meeting but I could not take his phone call.

It would have been rude for me to take a call in a middle of a meeting with a key bank customer.

Peter had to send me a text message.

“Bros, I have resigned from my bank. I had requested for an AK-47 from them after they doubled my already impossible deposit target but they could not provide the gun. From where do they want me to harvest N12 billion deposit liabilities in 90 days? Mad people! I’m off!” his text read.

The evil day is here Oh ye bankers! Our nemesis is here with us.

It started with the federal government’s no nonsense implementation of Treasury Single Account (TSA) policy and a decreed that all government’s idle funds must be kept in the CBN instead of the commercial banks.

TSA policy has robbed banks of cheap sources of deposits.

Before TSA, what it took a banker to gain a rapid promotion was to establish “connections” with the finance personnel in the federal government ministries, departments and agencies.

If a banker could “manage” the government officials to “abandon” funds meant for budgeted projects in his or her bank, the banker would be seen as a super performer and could be promoted beyond skill levels.

Though the FG killed the corruption associated with public sector deposits with a sledge hammer, the side effects of the policy have left the Nigerian deposit money banks with bloodied nostrils.

TSA tsunami has changed for good or for bad the banking industry landscape. One of the major fallout is that many high flying bankers in Public Sector departments in banks became redundant. Some of them were gradually and quietly sacked.

Not just long after the TSA wahala, a new challenge has emerged in deposit mobilization in the banking industry. This new challenge is stoked by recession and stagflation of Nigerian economy.

Besides the reality that many banks’ customers couldn’t repay their loans due to challenging business environment and the fact that banks need to raise more deposits to enable them meet funds withdrawals, all banks in the country now lay more emphasis on deposits mobilization.

Bankers have managed to cope until recently when federal government started competing with banks in deposit mobilization of Money Market space via its local borrowing activities.

You may ask “how?”

Debt Management Office and Central Bank of Nigeria’s increased citizen education have also made many bank customers wiser.

Bank customers now know that if they keep a deposit with a bank below inflation rate that they would be losing value.

Inflation rate is above 17.78p.a.

Banks’ fixed deposit customers now demand for rates above 18%p.a.

Would you blame the customers?

The situation has been worsened by depositors’ preference for the federal government’s treasury bills and bonds that offer better yield of 18-23% p.a for tenors of between 90-360 days.

This trend shall continue as the FG conveniently borrows short-term to finance its operations.

A banker colleague of mine was last week tongue-lashed by his longtime customer and a friend for shielding him from treasury bills and FG bonds in a bid to protect his deposit levels which was adjudged a selfish interest by this customer. No be small matter ooo!

Of course, the customer moved his funds and bought treasury bills at a higher yield. My friend was blacklisted.

How could my guy explain to his bank’s management that he lost N450million deposit even though the owner the money to his money?

Bankers are, now more than ever before, in a dire need of deposit liabilities to create loans and to maintain liquidity that would enable them meet unscheduled withdrawals by savings and current account customers even when loan customers have continued to default in loan repayment obligations.

If you work as a marketing staff in a bank and can’t generate or retain deposits, you are sacked.

Even the affected staff monitor their performance on a daily basis and can tell when they are due for a sack. It’s like a rain whose fall has since been announced by a gathering cloud.

So, you would now understand why a marketing staff of a bank would organize a thanksgiving service for being redeployed to a back office function.

Marketing role in banks right now is like a soldier or police officer posted to Maiduguri, Borno State; if not worse.

The exposure of Nigerian bank customers by technology to Internet and Mobile Banking has made it easier for bank customers to withdraw their funds by a click of a button.

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