A major challenge Godwin Emefiele has to grapple with in his five-year tenure as Central Bank of Nigeria (CBN) Governor is balancing vested interest in Zenith Bank with interest as regulator of the entire banking industry.
Godwin Emefiele
He comes straight to the CBN from Zenith Bank where he was Group Managing Director and Chief Executive Officer (GMD/CEO).
Before joining the bank, Emefiele, an alumnus of Harvard Business School, had lectured finance at the University of Nigeria, Nsukka (UNN), and insurance at the University of Port Harcourt (UNIPORT).
He joined Zenith at inception in 1990 and was appointed Deputy Managing Director in 2001. Prior to this, he was Executive Director in charge of corporate banking, treasury, financial control and strategic planning.
With a Bachelor of Science (B.Sc) degree in finance and an MBA also in Finance, both from UNN, Emefiele has over 23 years of experience in Zenith, where he became GMD/CEO on August 1, 2010.
Under his leadership, the bank grew in size and earnings. Reported gross earnings were N192.5 billion in 2010, a 13 per cent decrease from 2009 audited financial result.
However, at the end of financial year 2011, the gross earnings of Zenith Bank soared 26.72 per cent to N243.95 billion, and in 2012 rose 25.88 per cent to N307.082 billion.
In the financial year ending 2013, gross earnings amounted to N351.4 billion and profit after tax N95.32 billion. Customers’ deposits hit N2.27 trillion, total assets N3.14 trillion.
KPMG, the international management consulting firm, has rated Zenith as the “best customer-focused bank” in Nigeria for the second year running. Its rating in the 2014 Banking Industry Customer Satisfaction Survey (BICSS) was based on 2013 indices.
Despite Emefiele’s sterling performance at Zenith Bank, which many believe he will replicate in the CBN, there is apprehension as to how he can manage conflict of interest involving his former employer and his role as CBN boss.
Zenith Bank, where Emefiele was groomed, has been at the centre of several allegations and investigations for questionable dealings bordering on money laundering, and he is believed to have a vested interest in his bank and perhaps in other friendly banks.
In 2012, former CBN Governor Sanusi Lamido placed some banks under watch, including Zenith, for indulging in unethical transactions that left customers worse off.
Zenith was also among 13 banks investigated in connection with Jigawa State Governor, Sule Lamido’s son over which the State Security Service (SSS) detained some senior managers.
Some capital market operators, who pleaded anonymity, said where Zenith Bank is involved in infraction, it would be surprising to see its former employee being disinterested.
“In other climes, conflict of interest is quite easy to manage. But in this country where everything is done based on personal relationship, it will be surprising to see the former employee of Zenith Bank not pandering to the interest of his former employer,” said a stockbroker.
Although stockbrokers who spoke to TheNiche unanimously upheld Emefiele as eminently qualified for the CBN job, they expressed reservations in his ability to muster the will to deal with conflict of interest.
They recalled, however, that Sanusi came from First Bank to head the CBN without any known conflict of interest throughout his tenure.
They also cited Senator Udoma Udo Udoma, former Securities and Exchange Commission (SEC) Chairman, who, at the time of his appointment, was on the board of companies quoted on the Nigerian Stock Exchange (NSE) but had no known conflict of interest.
One way to manage conflict of interest is to ensure that an interest does not go against the rules, according to a legal practitioner, Kingsley Snomi.