It can recalled, President Ellen Johnson Sirleaf in her address to the 53rd National Legislature indicated that the Central Bank of Liberia experienced operational losses but it is in the process of implementing the necessary corrective measures.
“The measures will need to be taken to ensure that well-intentioned microfinance loans amounting to L$644.1 million (equivalent to US$7.2 million) granted to savings and loans clubs are repaid fully,” the President said.
But the National Legislature seems not to be buying into the President’s explanation. Montserrado County District#3 Representative, Bill Twehway, told members of the House of Representatives last weekend that the revelation of major operational loss at the Central Bank is worrisome especially in the wake of the current economic crisis.
The revelation by President Sirleaf has caused the lawmakers to establish a Special Committee intended to conduct a comprehensive hearing with the CBL Executive Governor Dr. J. Mills Jones. The Committee was immediately constituted by the plenary of the House of Representatives.
The committee is chaired by Sinoe County District#3 Representative Matthew Zarzar and co-chaired by Montserrado District#16 Representative Edward Forh.
President Sirleaf had further informed the lawmakers that “the Ebola Virus Disease led to an increase in Non-Performing Loans, and the CBL is therefore taking the needed measures to correct the problem”.
But Representative Twehway intoned that the revelation by the Liberian leader is shocking and there is a need for the Executive Governor of the bank to explain what went wrong and the extent of the losses.
“It is important to do this especially at the time the Governor’s tenure will soon expire in three months and a new Governor is expected to handle the mantle of power at the bank”, the lawmaker lamented.
The lawmakers are not alone in their concern for Governor Jones’ handling of the microfinance loan scheme. According to Central Bank insiders, IMF Executive Director Christian Lagarde was particularly angry when she visited Liberia recently to assess post-Ebola developments.
It was said, during one of her meeting with government officials, Madam Lagarde minced little words when she dressed down Dr. Jones for using the country’s money to entice votes. Lagarde was especially worried that problems created by Mills Jones’ microfinance loan scheme to high risk lenders could lead to capitalization of the Central Bank.