22 February 2014, Abuja – Trading at the Nigerian money market stood still in reaction to the suspension of Sanusi Lamido Sanusi as the governor of the CBN. On the website of the Financial Market Dealers Association, which is the trading platform of the money market bond trading, the market was said to have “experienced market shutdown”.
According to a source within the Financial Market Dealers Association (FMDA), the news of the suspension had “jolted everyone and had led to the immediate halt of activities in the market. The source, who pleaded anonymity on the basis of the impact it would have on international investors’ perception of the market, said “hopefully, it will normalize and the market will resume normally soon.
The source however noted that the “recovery is going to be gradual on the hope that the MPC policies will maintain the status quo as Reuben Abati has said in the statement this morning. “This should be a reassurance to the international investors who will react negatively to this news,” the source stated.
NSE Loses N186.59bn Market Capitalisation
The news of the suspension of the governor of the Central Bank has affected the trading on the Nigerian capital market as market capitalisation shed N186.59 billion, representing 1.47 per cent loss. Stockbrokers attributed the loss recorded to the news of the suspension of the governor as investors reacted negatively by pulling out, especially from the banking stocks.
The managing director of Lambeth Trust Limited, Mr David Adonri, said that the news of the suspension of the CBN governor had a negative impact on the market as investors were pulling out of the market. He pointed out that the banking stocks were worst hit as all the stocks were on full offer, which made the sector have the highest loss for the day, with foreign investors pulling out.
He added that, by next week, the market will return to gains but investors will take caution until they know who the next governor will be and the full membership of his Board and Monetary Policy Committee. Monetary policy, to a large extent, affects the fortunes of investors, he said.
A broker and market analyst, Mr Tunde Oyediran, said the news created tension in the market as investors were pulling out. He noted that the suspension of the CBN governor indicates that the government has lost confidence in the prime regulatory body of the financial sector and no foreign investor would want to invest in such economy.
Sanusi’s suspension casts government in bad light – Ezekwesili
A former vice president of the International Monetary Fund (IMF) for Africa, Dr Oby Ezekwesili, has faulted government over the suspension of Mr Sanusi Lamido Sanusi as governor of the Central Bank, saying the move casts government in bad light. Reacting to the action in her social media platform, www.twitter.com handle on Thursday, Ezekwesili also stated that the action clearly shows government’s intolerance for accountability.
Using her twitter handle, @obyezeks, Oby Ezekwesili, popularly referred to as Madam Due Process, tweeted, “Three things cannot be sent on suspension: the sun, the moon, and the truth!” She further stated, “I hope the President knows there is a dark cloud destruct in his suspension (of) Governor of Central Bank of Nigeria – Sanusi Lamido Sanusi.”
She stated further that “For CBN Gov to be suspended when serious issues of ‘missing $20Billion’ that he raised remain unresolved shows intolerance for accountability.” Concluding this round of tweets, she tweeted, “Possibly, Gov Sanusi of CBN may have issues to account for but his suspension at a time of public angst at poor management of oil revenue by FG?
Sanusi’s suspension irrational, unlawful – Abike Dabiri-Erewa
Also, Abike Dabiri-Erewa, a member of the House of Representatives representing Ikorodu federal Constituency and chairman of the House Committee on Diaspora, was miffed by the suspension. Se twitted on her Twitter page with the handle @abikedabiri : “Sacking of Sanusi irrational, against the law. Mr President needs approval of two-thirds of the Senate before a CBN governor can be sacked.” She later twitted that, “Sending a name for a replacement is tantamount to a sack. I am optimistic the Senate would tackle it appropriately.”
*Kunle Olusanmi – Leadership