The Central Bank of Nigeria (CBN) and deposit money banks (DMBs) have unanimously agreed to set up a N15 billion Victim Support Fund to help the vulnerable in the society.
They are also supporting food security and the settlement of the defunct Power Holding Company of Nigeria (PHCN) legacy debt.
The bankers agreed to assist government in the area of the over N25 billion PHCN legacy debt, through the establishment of a special purpose vehicle (SPV) so as to free the distribution companies for the much needed gas for power generation in the country.
In the reckoning of the bankers, their business can only prosper under a peaceful atmosphere. They further say that the weak, wounded and hungry must be supported as part of their contribution and responsiveness to the society, while the gas for power project must be supported for businesses in the country to thrive.
The agreement, which is in line with the developmental banking approach of Godwin Emefiele, CBN governor, was made on Thursday at the Bankers Committee meeting held in Lagos.
Addressing the media after the meeting Herbert Wigwe, group managing director, Access Bank plc, explained that the Victim Support Fund is meant to help alleviate issues with respect to vulnerable groups affected by insurgency in the country.
Wigwe said the sharing formular in terms of contributions by banks would be based on size and profitability, and would be done in such a way that it would not be a burden to them.
“We are fully aware and cognisant of the fact that if you do not resolve issues like this, if you do not contribute to the betterment of the system, it will always come back to haunt you. Perhaps if you do not do it, the issue of profitability one day may not even exist”, he said.
He observed that the national biometrics project and the cashless policy have gone nationwide, adding that the bankers committee was not happy with the extent to which they have been enforced nationally. They agreed that banks should deepen the overall level of enrolment of their customers in terms of the number and time-frame within which they enroll.
Jibril Aku, managing director/CEO of Ecobank Nigeria, said one of the issues discussed at the Bankers Committee was gas to power, where they agreed to support an initiative with the government to set up a Special Purpose Vehicle (SPV) that would provide loans that would clear the N25 billion PHCN legacy debt.
Aku recalled that the ministers of power and petroleum, as well as the CBN governor, met recently and agreed to an increase in the price of gas because they wanted a situation where gas would be commercially available to encourage the gas companies to produce commercially.
“That announcement is based on the recent increase in the price of gas from $1.5 to $2.5 per 1000 standard cubic feet, with the transportation cost at $0.8, so today at $3.3 it is enough incentive for gas companies to produce gas, and that is necessary because when you look at the 26 generating stations we have in Nigeria, 23 are gas dependent and it is important for gas to go in there for them to begin to increase their production.
“We feel its one major incentive that will help gas companies to begin to produce commercially”, he said.
Timothy Oguntayo, managing director of Skye Bank disclosed that the Bankers Committee agreed to support the 18 rice milling plants in the country to aid local production of rice and to help in embracing backward integration or the AGOA scheme.
HOPE MOSES-ASHIKE
