Former President of the Senate, Senator Adolphus Wabara, left the National Assembly in June 2007. He has since remained a leader of the Peoples Democratic Party (PDP) and a member of the Board of Trustees (BoT) of the party. In this interview with Group Politics Editor, Taiwo Adisa, he describes the February 9 intervention of the National Assembly which confirmed Dr. Goodluck Jonathan as Acting President as timely. He also speaks on the ongoing reforms instituted by the Central Bank of Nigeria under the leadership of Governor Sanusi Lamido Sanusi, among other national issues. Excerpts:

N ot much has been heard from you since you left office, how has it been since you left National Assembly?
It depends on which office you are talking about. I left office as a senator in 2007 and, since then, we have been watching and seeing very interesting things happen, particularly in the National Assembly. Nobody retires from politics, so to speak. It’s a question of turn by turn. Today, you are irrelevant and tomorrow you are very relevant and conspicuous in the political terrain. So, we just wait and contribute our own quota.

There is no retirement age, they say, in politics. Otherwise, you will not find the like of (former President Olusegun  Obasanjo) OBJ still there and even General Yakubu Gowon, General Danjuma, IBB and co.

It’s just a question of when you are remembered for some good works and they think you can fit in somewhere; you are called upon for service. Politics is a little bit quiet on our side now. But I’m happy that we contribute on national issues.

As a member of the BoT of the PDP, one expects that there will be a lot of moves by the party at that level to resolve the lingering  leadership tussle in Nigeria, particularly the absence of President Umaru Yar’Adua. Why is it that your party has not been able to take a proper stand on the issue?
I’m really very much disturbed about that. I don’t want to mention names, but I made contacts with those who have direct links with the former President Olusegun Obasanjo, who is the Chairman, Board of Trustees. I would expect that an extraordinary Board of Trustees meeting should have been convened by the chairman to discuss what is happening now, in order to give support to our government, because it is PDP’s government that is in place, so that we don’t allow the Acting President to wander.

I have spoken to a number of people, who are well placed to organise such a meeting. Even if the secretary is not around for certain reasons, other people can take up the responsibility. We should take up the challenge of ensuring that our party takes the lead in doing the right things.

Some people have complained that what the Senate did by empowering Dr. Goodluck Jonathan as Acting President was unconstitutional and that the best option would have been for the cabinet to invoke Section 144 of the Constitution, why has this been difficult?
I don’t think the FEC issue should be that difficult if we are sincere. The governors could have put pressure on their ministers since they submitted their names. They could have called their ministers and say “Let’s do this,’’ unless there is something that one cannot explain.

If I was a governor and I submitted the name of a minister from my state, then I should be able to call that minister to order and say, “Do this, and this’’ and if every governor that submitted names to the Presidency for appointment as ministers did that, there wouldn’t have been any difficulty in investigating the health status of the president.

Why they have difficulty in doing so is what Nigerians are still expecting explanations for. Something must be wrong but I thank the National Assembly for what they did, they called it doctrine of necessity, which is okay and that has doused tension and, today, we are moving forward. If you don’t know what to do, you do what you see. That is exactly what has happened.

I am happy that Nigerians embraced what the National Assembly did and I thank Senate President, David Mark and Speaker Bankole for saving our democracy.

During your tenure as Senate President, you recommended classification of banks as against the outright consolidation recommended by the then CBN Governor, and that was seen as a confrontation between your leadership of the Senate and the then executive. But recently, the CBN Governor, Sanusi Lamido Sanusi, announced reforms which conformed with your earlier recommendations, how do you read this?
The moves by the CBN under Sanusi Lamido are a very positive development. Ab initio, there was a need for categorisation, in addition to other policies that were embarked upon by the CBN to lay a solid foundation and reduce the damage.

I recall that when we were there in the Senate, the Senate Committee on Banking, led by Senator Zik Ambuno, recommended categorisation as the way to go about the banking reforms. We felt that that was the way to go after a careful look at the sector but the government at the time felt strongly about a single capital base.

The banking industry was grossly undercapitalised and that was as a result of years of creating injuries that affected liquidity. I believe there was a consensus on the area of consolidation but there was disagreement on capital base and at that the time, the regulatory authority felt the banks must cough out N25 billion.

But beyond that, we also looked at what was happening. At the end of the day, what is important is the people.

Capital base should be driven not only by policy but by success made at various levels. Share capital should be boosted by profits from operations. But when you come out with a policy like that and you generalise, that is why we are having the problems we have.

How many tiers of banks do you think will serve the system right?
At that time, we were thinking that we should have had three tiers. A lot of things went wrong. I think also that policy was very faulty in the sense that N25 billion capitalization when the policy was being introduced, the Asset Management Company (AMC) was to be created prior to the deadline for

recapitalization and we all know the importance of that company. Banks, by the nature of their business can create a lot of risk assets. So, you don’t want to put undue pressure on management after recapitalisation.

To that extent, the Asset Management Company should have been created so that assets in the books of the banks would have been taken. That company was never created and up till now that I’m talking to you, it hasn’t. So, that mounted a lot of pressure on even the so-called recapitalised banks. They were now carrying in their books assets that were toxic into income of the banks. That was a big pressure there.

Then we also had the issue of political pressure in the sense that the capitalisation policy was not done based on a level playing field. Some banks in the industry were on liquidity support to enable them scale through the banking consolidation. We had a situation whereby the CBN approved about N80 billion for two or three banks to enable them recapitalise.

But you didn’t do the same thing for other banks. So, you now had the issue of ethics. That became a problem. At the time, you imposed N25 billion new capital on banks which were struggling to have N2 billion capital base within a period of less than two years. So, because they are now carrying a liability of N25 billion of shareholders fund, suddenly we realize that many of them didn’t meet it.

At the end of the day, as managers of that institution, they will have to generate income to be able to give returns to the investors and that was the single factor that led to the second round of serious problems that we are having.

So, the banks were now doing all sorts of unethical things to enable them to raise revenue so that at the end of the year, they will pay dividends. They were creating assets; they got involved in speculative activities and abandoned the core banking transactions. They went into these things merely to justify the fact that people invested in them. So, that created so many problems and that was what led to the problem we have in the stock market. So, you can see that the policy did not only damage money market and the banking industry alone.