Banking Finance

If you have been taking a look at certificates of deposits, you will almost certainly be aware why a longer maturity rate on them will get you more cash. But you might have often wondered what it is that goes into the best CD rates; whether it is Ally bank CD rates or CD rates of any other bank for that matter. You will want to know this from Ally bank formerly know as GMAC bank and other banks too so that you get the maximum returns on your investment no matter what your method might be.

But then getting the best of just about anything needs a substantial amount of effort to be put in and it is not any different when it comes to Ally bank CD rates. You will have to take a look at all the possible CDs available before you go on to decide which ones in Ally bank will get you the highest rates. This information you might get by going online or visiting the banks or through word of mouth from friends and family who have already invested in them.

If you will be working on your investment single handed, you will probably want to keep two things in mind; the length of the period of maturity so you might want to look for those Ally bank CD rates that will last in the long term rather than those that will bring you less money in the short term. Besides, you have to bear in mind what the investment rates are like at the time you are purchasing. This will hold good whether you are investing in CDs at Ally bank, Chase bank, Bank of America, Citibank, Wachovia, Wells Fargo, U.S. bank or any other bank for that matter.

You might ask why it is better to invest in the longer maturity Ally bank CD rates. In the end it comes down to how much you invest in this. There is no doubt that you are taking on extra risks through this kind of CD rates of Ally bank and consent to keeping your money there for a long period of time, but then it is sure to pay off even better if you invest successfully.

Besides, there are other benefits of investing in these longer maturity Ally bank CD rates. The Ally bank as well as other banks normally give first preference to these choices and pay them the best in turn. Some banks require a minimum amount to be invested; in such cases you might want to take into consideration bulk purchase for your rates. You need not stick to just one bank but check out what’s going on at the other banks as well so you get a fair idea of what deals are offered by which banks.

The Central Bank of Nigeria (CBN) has announced the sack of 5 bank chiefs in the country. Those who fail to see through their nose have hastily hailed the action calling it an action in the right direction. It is typical for Nigerians to make hasty reactions usually hailing decisions from our action-packed leaders. This is one of the cases.

Although, the action of the sack of the bank chiefs is too belated to reverse, it is definitely not one with the aim of strengthening the financial base of our economic system. It is like curing a symptom but not the cause of an illness. Something is surely responsible for the ailing of the banks in the country; this is rather what the Central Bank of Nigeria and the leaders of the nation must hasten to find solution to. Take over of banks in the country will do nothing to move us forward. Soon and very soon, the Governor of Central Bank of Nigeria will take over all the banks in the country, never to return them.

While no one is making a case for the affected bank chiefs, it would have been just in place if the government had invited them to find out what was wrong, which would have given them the opportunity to defend themselves rather than play to the gallery and try to win the heart of  President Yar’Adua. Will President Yar’Adua not have inquired from the CBN Governor what was responsible for the near collapse of the banks as claimed by the CBN? The Central Bank of Nigeria played to the gallery.

What was responsible for near collapse of the banks is still living with our leaders and their cronies. Indeed anyone who has a good comprehension of the Nigerian situation will blame the nation’s situation on its leaders. As usual again, our leaders have displayed signs of exhaustion of ideas to move the nation forward. It is laughable to hear our CBN Governor tell us that many more banks may soon be taken over rather than seek a more profound solution beyond the surface of taking over banks.

Any businessman who survives the economic tide in Nigeria is an economic champion. Nigeria is a country without economic encouragement and base even the Bill Gates of America may fail to make impacts in terms of running of financial outfits. Everything is certainly wrong with the country as a place where businesses are expected to be smooth. With guaranteed constant failure in the energy sector of the country where light is not an advantage, outfits will certainly rely on constant supply of diesel or fuel where applicable to maintain the tide. Lack of security too will lead to high spending on protection of bullion vans because Armed Robbers may cart away with more monies than the bank has. Influential people anointed by the leaders of the nation constitute more than 88% of borrowers from the bank without collaterals.

In fact, many ordinary borrowers of money from the Nigerian banks often fail to meet up because of high poverty rate in the country thus only the wealthy can conveniently afford to take loans from the banks. The mere sound of obtaining loans from the banks is so scaring to the ordinarily citizens that it is like a taboo to imagine it. Microfinance banks are now daily springing up in the country where commercial and other kinds of banks are nothing to write home about. So the question needs to be asked on which one bank can genuinely claim to be healthy in the country compared to what fare in a country like South Africa. If no adequate policies other than resort to the sack of bank chiefs are deemed fit then as stated earlier, the CBN will soon take over all the banks in the country.

Today, rather than go to the banks for transactions, our banks are moving to people in local markets where tomatoes, oranges and “pure-water” are sold to come and obtain loans with high percentage of interests. What a country! What we fail to understand is that when things are good, people will naturally draw closer to our banks and only the provisions of the ordinary basics of life by our leaders will make this work but what can our leaders do for us in a country where we constantly change the colour of our currencies even as it does not affect the nation’s economic base. How do bank chiefs function in this financial environment? Ask CBN.

And now that the Bank chiefs have been sacked and newer ones installed, what is the tendency that these banks will gain good financial health? The action is certainly like a new wine in an old vessel which Jesus Christ condemned. Mr. Sanusi should look beyond dismissing Bank chiefs and installing newer ones but come up with objective policies that will guarantee their financial base. It is entirely up to the government of the nation to achieve this with good governance which is what Mrs. Hilary Clinton canvassed even as the government blamed their enemies for inviting her to run them down but the truth must be said no matter whose ox is gored. We should think of more result-oriented policies to make our banks perform.

The Governor of Central Bank (CBN), Mallam Sanusi  Lamido Sanusi has  said he was not afraid of anybody since he believed he was doing the right thing to sanitize the Nigerian Banking sector and those super Nigerians who feel they were untouchable would soon receive the greatest surprise of their life.

Sanusi spoke on the Hausa Service of the British Broadcasting Corporation (BBC) monitored in Kaduna on Monday, adding that what Billionaire Businessman, Jimoh Ibrahim said about his N14 billion loan from Oceanic bank was not true.

“Honestly, I am not afraid of anybody, whatever that I am supposed to do, once it is within my jurisdiction I will do it. I want to assure you that there are some people who think nobody can touch them, those people would be surprise.”

“On Jimoh Ibrahim, it’s not true and I would not like to be exchanging words with anyone, when we investigated we found that he got N14 billion loan from the bank, what happened was that Oceanic bank told him if could pay N12 billion ,they would forfeit the N2 billion.”
“ After our examination, he went and paid N4 billion thinking he had paid out of N12 billion, remaining N8 billion. In the first place he has not paid the N12 billion for them to give him a waiver of N2 billion. Secondly when we went to investigate the account, as of 31 of May, Jimoh Ibrahim took loan of N14 billion,” he said.

The CBN boss lamented that some of the loans were discovered to be deceitful as the sacked Managing Directors of some the 5 banks used the money for their own selfish purposes.

His words: “Those working in the banking sector know the problems in the banking industry more than those people outside who do not know the major problems that are facing some banks. The global economic meltdown has affected Nigerian banks in 2 ways.”
“ The first is like we know that the price of oil has fallen, some banks had given out loans and when the price of oil fell, some of the debtors deliberately refused to pay and the banks lose. There were also many banks that used people’s money to trade in stock exchange market, and they also lost money in that process when the stock market crashed.”

“So instead of these banks to come out like their foreign counterpart and tell the world the loses they incurred, and if they needed more investment for them to source for the money, they choose to hide their problem and the CBN had continued to help them with money since October.”
“ So we decided to investigate and we found out that 40% of the loan given out by these banks may not be repaid. That meant the banks were on the way to collapse. But in order to salvage people’s money, we pumped in N400 billion into these banks.”

Commenting on Charles Sulodo who was assuring that Nigerian banks were okay before he left, Sanusi said “I have one principle, if you observed when I stood before the Senate; I never liked to criticize my predecessor.”
“Now that I am in the office and entrusted by people, whatever needs to be amended is incumbent upon me to do that, what he (Sulodo) had done has passed. If some people had something to say, I would not like to comment on that.”

“Investigation is on, on 11 more banks and would be completed at the end of this month, 3 other banks, City bank, Standard Chartered and Stanbic, we will complete the investigation in September.”
“ So people would know everything but what we understand from our end, is that those 5 banks had serious problems in Nigeria and had given out more loans than any other. Even if other banks have problems, such problems are not insurmountable.”

“Leadership is always a difficult thing, when you investigated and found the truth, it would be improper to just keep the report on your table. When these banks crumbled, poor people with money in such banks will suffer.”

“ Many people had become victims of these failed banks, this step we have taken and the step we think is right is that step that would protect people’s wealth. But action should be taken on these banks executives and those who borrowed the money and refused to pay.”

“Why we have to make public names of the loan defaulters were because some people have started saying it was a Northern agenda that we want to crumble some of their banks, so we decided to let the world know what was really going on. Any bank that gives out loan of N300 billion and the money is not recovered, should such bank be allowed to be or not?”
“ Secondly such people that collected the loans are those who go behind to criticize, saying what is happening to the banks is wrong. So we feel is proper for the public to know that it is such people that are benefitting from the system, they borrow without paying back.”
“ They borrow money belonging to the people and build houses, buy aero planes and travel around the world. People should know that it was their money these people are using; perhaps this may prevent such misuse and sanitize the country.”

“What we have seen the EFCC doing after sitting down with them, they sat with the Managing Directors of these affected banks and they gave them the names of those involved. There are those who sought for extension of time to repay the loans and were given, there are those who achieved what they wanted with the loans but had refused to pay back.”
“ There are those loans again that were full of deceit, it was actually the bank MDs that gave themselves the loans and established companies with the money in their names, or that of their cronies. The authorities are really behind such bank officials to get people’s money,” he said.

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