Central Bank of Liberia Governor-Designate Promises to ‘Rebuild Confidence’ in Banking Sector Amid Concerns about Conflicting Information on Resume
Monrovia – When Central Bank of Liberia Executive Governor-designate appeared at the Liberian Senate confirmation hearing on Thursday, he left lawmakers in a mixed mood.
J. Aloysius Tarlue told the senate how he would fix the crumbling Liberian banking sector during the hearing but there were also some concerns about conflicting information on his CV.
When asked about his plans to lead the CBL during the hearing, he said “My vision, as governor, will be to rebuild confidence in the CBL and the banking sector as a whole in the next five years.”
He continued: “This will be done through the banking sector, as a whole, in the next five years. This will be done through reforms aimed at improving governance, ensuring technical soundness in policies, and achieving financial sustainability of the CBL and above all ensures that the CBL is focused on carrying out monetary policies that seek to keep inflation low, stabilize the exchange rate, as well as ensure that Liberia had enough foreign exchange buffers.”
He promised Senators that when confirmed, his key priorities will be to promote independence of the Bank and also promised to review the Act that created the CBL and forward to the legislature for amendment.
“Internal audit and control functions will be strengthened. Key policy decisions will be made and implemented with the approval of the Central Bank Board of Governors,” Tarlue said.
He also promised to ensure the implementation of “technical sound policies” by strengthening the research department of the CBL so that policy decisions are informed by proper analysis and evidence.
Said Tarlue: “We will ensure that the CBL is focused on carrying out monetary policies that seeks to keep inflation low stabilize the exchange rate, and ensure that Liberia has enough foreign exchange buffers. We will promote the soundness of the Banking sector by strengthening the CBL’s supervision functions-currently non-performing loans in banks are well above the 10% threshold.
“Regarding achieving financial sustainability of the CBL, we will undertake a strategic and functional review of the CBL’s operations.”
He said the Bank is currently incurring losses due to various inefficiencies, including a bloated workforce, which the budget cannot sustain.
According to him, “if the CBL cannot fix itself, it cannot help fix the country’s monetary challenges.”
He promised to prioritize regaining and then maintain price stability by reducing the rate of inflation to single digits over time.
According to him, weak safeguards framework at the CBL continues to be a key problem. He promised to rebrand and repositioned to help tackle the current economic challenges the country face.
Restoring Public Confidence in CBL
In further comments during his confirmation hearing, he told senators that no amount of policy crafting and announcement will prove effective unless depositors trust the banking process.
He said customers will have confidence when they take their money to the bank, and they can get it back anytime they want.
He continued: “On the other hand too, commercial banks need to have the confidence also that when they take their money to the CBL, their depositors will be saved and they can get their money whenever they want it. For us to win back the confidence of depositors and by large the people of Liberia and international partners, the CBL must strengthen its safeguard mechanism and effectively enforce regulations and controls.”
“We will ensure that the CBL is focused on carrying out monetary policies that seeks to keep inflation low stabilize the exchange rate, and ensure that Liberia has enough foreign exchange buffers. We will promote the soundness of the Banking sector by strengthening the CBL’s supervision functions-currently non-performing loans in banks are well above the 10% threshold.”– J. Aloysius Tarlue, Governor-designate, Central Bank of Liberia
Date of Birth Mixed-Up
Meanwhile, Senators were concern about apparent conflicting accounts in Tarlue’s Curriculum vitae (CV), but he said they were minor oversight that should not overshadow the main issues.
In one account, his CV declared that in 1952 was the year of the birth while his year of birth in another part of the CV mentioned that he was born in 1962.
In other parts of the CV, he told members of the Senate Banking and Currency Committee that he worked as compliance analyst from 2004-2007 at the Merrill Lynch Bank and in the same CV worked as Compliance Analyst at the HSBC Bank NA from 2004-2007.
The senator, despite the inconsistency in the CV, went ahead with the confirmation hearing of Mr. Tarlue but refused to hold confirmation proceedings for Madam Nyemadi Pearson, who is the Deputy Bank Governor designate, because of ongoing legal proceeding involving Mr. Charles Sirleaf in whose position she is been nominated.
He, however, failed to correctly answer a question pose by Senator Darius Dillon of Montserrado Coounty about whether it was the President’s role to request the Legislature to give authorization for the printing of new banknotes.
Talue also could not confirm or state what was the process used by the special vetting committee that led to his nomination as CBL governor designate.
President Weah had earlier announced that a special vetting committee would vet qualified individuals that would replace the resigned Nathaniel Patray
Despite the mixed-up which some describes as typos, Mr. Tarlue still believes that he is the “right man for the Job” as he bragged about having more than 17 years of solid policy drafting review and quality compliance experience.
He also told lawmakers about his experience in enforcement and standards in five global financial institutions, mainly in the United States.
“Mr. Chairman and distinguished members of the committee, I approach this task with a clear understanding that monetary policies are not necessarily in short supply at the Central Bank of Liberia. I submit that the key challenge that continues to undermine our monetary policy implementation is the lack of effective enforcement of regulatory and compliance measures,” he said.
Unlike his predecessor Nathaniel Patray, Mr. Tarlue promised to remain a non-partisan governor who will take decision based on inform fact from data provided by the bank.
It can be recalled that the former CBL Executive Governor Nathaniel Patray, whose resignation President Weah accepted since October 24, left the bank amid serious liquidity crisis along with systematic flaws in its banking procedures—a situation his administration was unable to address.
Given the current state of the CBL, Patray’s successor will have to work tirelessly to resolve the systematic flaws in the institution’s banking procedures, and initiate a strong policy to tackle rising inflation, a heavily devalued local currency against the U.S. dollar this year and a slack in private investment.
Prior to his preferment by President Weah, Tarlue, was Chairman of the Board of Commissioners of the Liberia Electricity Regulatory Commission (LERC). LERC is responsible to regulate the electricity sector in Liberia by determining the legal and regulatory framework for generation, transmission, distribution, trading, import & export, and sale of electricity within the Republic of Liberia.