Panic withdrawals and a thick cloud of uncertainty have shaken Nigeria's financial sector after the sacking of the directors of five key ailing banks, according to operators and analysts.
Central Bank of Nigeria (CBN) governor Sanusi Lamido Sanusi this month removed the heads of Afribank, Intercontinental Bank, Union Bank, Oceanic Bank and Finbank for piling up billions in bad debts.
About a dozen other banks are under scrutiny to determine their viability, debts and liquidity.
"There are apprehensions in the industry on what will be the fate of the remaining banks," said Sunday Adeola, a treasury manager in one of the nation's banks.
The dismissals of the bank chiefs, and the anti-graft agency's threat to arrest, prosecute or seize property of the debtors of the banks if they failed to pay in a week, had put the heat on the sector, analysts said.
"The... system has witnessed massive cash outflows in recent days. Depositors are jittery and they are withdrawing their money," said analyst Joel Allison.
"Bank vaults are becoming empty and if the trend continues we may have another bank failure," he said, recalling the liquidation of dozens of distressed banks in the 1990s after bad management and fraud.
Dozens of the owners and managers of those failed banks were prosecuted or jailed.
The CBN chief accused the management of the five ailing banks of giving loans to prominent businessmen and companies without adhering to good corporate governance and risk management practices.
He put the total loan portfolio of the ailing banks at 2.8 trillion naira (R142 billion).
The CBN has published a list of dozens of prominent Nigerian businessmen as debtors to these banks, including tycoon Aliko Dangote, rated by Forbes magazine as one of the richest Africans with a net worth of about $3.3bn (R26bn).
Dangote has denied managing the oil and gas company listed as owing more than 8 billion naira.
The Nigerian government has in recent days tried to calm the nerves of agitated bank depositors by assuring them their money was safe and it would not allow the banks to sink.
The government has already announced a 400 billion naira bailout for the affected banks.
Nigeria's central labour movement, the NLC, lauded Sanusi's action and urged the CBN to restore public confidence in the industry.
Rasheed Yusuf of the Association of Stockbroking Houses of Nigeria also called for proper management of the situation "in a way that the market will not be jeopardised".
Five years ago, in a bid to shore up the capital base of financial institutions, the number of banks was cut from more than 90 to 25 solid ones.
But that caution appears to have dissolved in more recent times and the global economic crisis has made the credit crunch that much tougher. Mindful of the 1990s crisis, weary Nigerians are being cautious.
"Yesterday I took all my money from my bank to avoid possible unpleasant consequences," said Femi Afolabi, a Lagos hotelier, who lost almost 3 million naira in 1995 when his bank failed. - Sapa-AFP