…as Reps threaten zero allocations to erring DFIs in 2017 budget
Waheed Olagunju, acting managing director of Bank of Industry (BoI), said it would require about N1 trillion to boost its activities.
Olagunju said on the sideline of the public hearing initiated by the Adhoc Committee investigating the activities and funding of Development Finance Institutions (DFIs), chaired by Emeka Anohu.
The Ad-hoc committee via a letter dated December 9, 2016 had requested for audited accounts of Central Bank of Nigeria (CBN), Small and Medium Enterprises of Nigeria (SMEDAN), Nigerian Export Import Bank (NEXIM); Bank of Agriculture (BoA); National Economic Reconstruction Fund (NERFUND); Federal Mortgage Bank of Nigeria (FMBN) and Infrastructure Bank, among others.
Olagunju, who spoke on the successes recorded by the bank so far, disclosed that the bank obtained a 15-year debenture worth N535 billion from the apex bank in 2010.
“We obtained the sum of N535 billion from CBN, it’s a 15 year debenture. In 2010 that was when the debenture was issued, so that’s 2015, so we’ve done six years now, we have nine years more.
“Certainly, it is not enough. I mean we need to turn around the industrial sector of the country, we’ll need more than a trillion because when the CBN gave us that intervention fund it was like a drop in the ocean vis-à-vis the appetite in the industry as at that time.”
Speaking earlier before the Adhoc Committee, Olagunju who expressed concern over the failure of Federal Government to provide the N100 billion pledged to sustain the bank’s operation since inception, noted that only N10 billion was released so far to the bank.
“The CBN intervention helped us which was given in 2010. The N535 billion was released and of course the Cotton Textile and Garment (CTG) too helped us with N100 billion that also helped us too. That makes it N635 billion, those are the two interventions that make the difference to BoI.”
On the level of default, Olagunju disclosed that 96 percent of the bank’s portfolio (representing less than four percent non-performing loan) are performing.
“It is difficult to have 100 percent performing. The CBN threshold is five percent and the industry average (NPL) is 11 percent, so we are performing more than the CBN threshold of five percent and the industry threshold of 11 percent,” Olagunju said.
While addressing representatives of the DFIs, Emeka Anohu threatened that the House will give zero allocation in the 2017 Appropriation Act, to any erring institutions, which fail to cooperate with the committee.
Anohu who presided over the investigative public hearing specifically expressed displeasure over the failure of Godwin Emefiele, CBN Governor and Chief Executive of SMEDAN and other DFIs from appearing before the committee.
Worried by the development, Anohu who issued a seven-day ultimatum to the CBN Governor and chief executives of all the DFIs to submit their audited accounts and intervention funds received from the apex bank, otherwise, the committee may invoke relevant sections of the Constitution with the view to compel them to appear.
However, the Committee which frowned at the late submission of documents by Nigerian Export Import Bank (NEXIM); Bank of Agriculture (BoA); National Economic Reconstruction Fund (NERFUND); Federal Mortgage Bank of Nigeria (FMBN) and Infrastructure Bank, resolved to adjourned till January 17, 2017.
Anohu said: “That is the essence of this investigative hearing and that is why we ought to know their position and what they have achieved with the money that were given to them. And if for any reason we found that the monies have not been properly utilized, of course as a House, we will be proposing that the DFIs should be scrapped but until our investigative hearing is concluded we can’t say that for now.
“We are not with-hunting anybody. But we will certainly ascertain the status of what the DFIs. The parliament has a way of ensuring checks and balances, we will ascertain the value of money, we will ascertain the status of the beneficiaries of these funds, what purposes were they utilized for. It is not about with-hunting, it’s not about anybody, we didn’t know them personally, so how can we with-hunt who you don’t know?”
