It has become necessary to alert the nation of a dangerous, indeed an explosive scheme by which some state Governors are mortgaging the future of their states through excessive borrowing from commercial banks and other financial institutions to finance projects of dubious viability.
The motive is entirely unclear. But one suspects it is either to fraudulently acquire campaign funds as the 2015 elections approach or retirement benefits. Some of them are also desperately selling off state’s assets including shares and other long term investments.
In a situation where states’ legislatures have reduced themselves to all but an arm of the executive, it is unrealistic to expect them to check and stop this fraud. We therefore appeal to the anti-corruption agencies to intervene.
We also warn banks to desist from connivance with those Governors. They need to be reminded of their civic responsibility and banking ethics to protect helpless public. They must be aware that most of these states have already lost the capacity to meet their financial obligations due to huge debt burden and diminishing source of revenue resulting from falling oil revenue.
The bankers must not forget that, in the past, collapse of oil prices in the world market have often led to widespread collapse of Nigerian banks because they never learned to say ‘no’ to prodigal but cash-strapped state governments in such critical periods.