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Tag: Debt

  • Popular Nigerian airline puts two aircraft for sale to settle debt

    Popular Nigerian airline puts two aircraft for sale to settle debt

    The board of Medview Airline Plc has resolved to offload two of its aircraft so as to pay part of its debts.

    This decision was reached at the meeting of the board of directors held on Thursday, July 23, 2020, via a video-conferencing application called Zoom.

    “There will be a board of directors’ emergency meeting of Medview Airline Plc to be held virtually by Zoom on Thursday, July 23, 2020, at 12:00 noon,” a notice signed by the company secretary, Abdullahi Adam Abdullahi & Co, had stated.

    The scribe had further noted that the board will, at the gathering, deliberate on the “effect of the COVID-19 pandemic on the operations of airlines in the aviation sector and the financial status of the company, amongst other matters.”

    Informing the investing public of the outcome of its deliberations yesterday, Medview Airline, which is one of the firms that has failed to file its financial statements to the Nigerian Stock Exchange (NSE), said it was agreed that two of its aircraft should be sold.

    According to the disclosure issued on Friday, it was said that the board resolved to sell its B737-400 5NMAA aeroplane in Estonia and the B737-400 5NMAA aircraft in Lagos.

    Medview explained that the reason is to “enable the company to liquidate part of its indebtedness and inject part of the funds into its operations so as to jump-start it again after the COVID-19 pandemic total lockdown.”

    In addition, the board also agreed to “return the leased aircraft engine to Aeolus, the lessor, so as to obviate the payment of additional rent; Engine number CFM56-3C1 ESN 857871.”

    At the meeting too, the board approved the resignation of two directors; Mr Ayodeji Ariyo Gbeleyi and Mr Olabode Kacheef Oyedele.

  • NDDC clarifies N2 trillion debts

    NDDC clarifies N2 trillion debts

    The Niger Delta Development Commission (NDDC) has clarified N2 trillion debts, owed vendors and contractors on projects executed in the region.

    The NDDC Deputy Director of Corporate Communications, Charles Odili, told newsmen in Port Harcourt on Monday, that the commission incurred the debts mainly from emergency projects.

    He said that past management of the commission resorted to emergency projects due to failure of the National Assembly at the time, to come up with budget for NDDC.

    “So, a large percentage of the N2 trillion debts were for emergency projects because NDDC budget did not come on time as at when due.

    “In this situation, past managements took to emergency projects as line of action to solve emergency situations.

    “It is unfortunate that often times when the budget is not available, the emergency projects runs for a long time,” he said.

    Odili said that current Interim Management Committee (IMC) led by Prof. Kemebradikumo Pondei, had decided against continuing with such tradition.

    He denied allegations of missing funds, insisting that only N33 billion was paid to vendors owed lesser sums out of NDDC’s N2 trillion debt portfolio.

    According to him, the IMC did not pay other categories of contractors as the National Assembly instructed against payments for road projects.

    “Unfortunately, many of NDDC contractors that are being owed are mostly those who have done road projects and they are complaining.

    “So, when people say that we are paying so much, what they don’t know is that we are paying very little from the avalanche of debts that we owe as an organisation.

    “So far, the N33 billion payments which we describe as ‘historical debt,’ were paid to vendors since inception of the IMC on February 20.

    “The payments were intended to save lives and livelihood of people of the Niger Delta, as some vendors were owed N1 million to N3 million over eight years,” he added.

    The NDDC spokesman described as unfortunate, the several delays encountered in the passage of NDDC budgets in recent years.

    Odili said the delays had impacted negatively on the commission’s quest to achieving its set goals and objectives.

    “In addition, the NDDC 2019 budget was never implemented, simply because the final budget got to the commission six weeks before its expiration.

    “So, it was virtually impossible to do anything about its implementation,” he pointed out.

    Recall that President Muhammadu Buhari in 2019, set up the NDDC IMC to help create an enabling environment for ongoing forensic audit of the commission’s finances.

  • AMCON seizes Doggi Group assets over N440m debt

    The Asset Management Corporation of Nigeria (AMCON) has seized assets belonging to Alhaji Umaru Baba Abdullahi, the Chief Promoter of Doggi Group Limited over N440 million debt.

    The corporation took over the assets after an order of Justice A.I. Chikere of the Federal High Court, Abuja division on June 5.

    In compliance to the enforcement order, AMCON 2020 took effective possession of the two properties through its Receiver – Mrs. Juliet Benson of Benson Reeds Legal Practitioners, which include properties situate at Plot 3810, Cadastral Zone A04, Asokoro District, Federal Capital Territory (FCT), Abuja and Plot 1274, Cadastral Zone B07, Katampe Hills, Katampe District, Abuja.

    In a statement, AMCON said the case of Doggi Group Limited and its promoter have been a protracted issue because the loan was purchased during the first phase of Eligible Bank Assets (EBA) purchase from Union Bank Plc way back in 2011.

    Since then, AMCON has offered the obligor a good measure of olive branches and explored all avenues to resolve the matter amicably, but the obligor, and his company, Doggi Group Limited have remained recalcitrant and unwilling to repay the huge debt to the Corporation.

    Confirming AMCON had enforced on the assets in line with the order of the court, Jude Nwauzor, Head of Corporate Communications Department of the Corporation said: “Yes, we enforced on the properties today as ordered Justice Chikere’s court, and are grateful to the Federal High Court for working on behalf of Nigerians to recover some of the debts owed the country by a few individuals despite the challenges posed by the dreaded Coronavirus (COVID-19) pandemic to institutions including the judiciary.

    “Like we have always said in the past, our priority at AMCON has never been to take over anybody’s properties or assets. Our mandate is to recover Nigeria’s money in the hands of these obligors. Overtime however, we have observed that the obligors enjoy hiding under some legal technicalities to delay even the repayment arrangement they negotiated and signed.

    “When you have held several meetings and arrived at an agreement but the obligor decided to make a U-turn by reneging, it leaves AMCON with no other option than to approach the court. In the case of Doggi Group Limited and its promoter, AMCON did everything any responsible and law abiding organistaion ought to do to help the promoter and his business continue to no avail,”

  • Atiku’s scaremongering on debt profile hinged on false premise, says FG

    The Federal Government has said former Vice-President Atiku Abubakar’s comment on the nation’s debt profile is mere scaremongering anchored on a false premise.

    But main opposition Peoples Democratic Party (PDP) supported Atiku’s stance that the economy is in shambles.

    A statement on Wednesday in Abuja by the party’s spokesman Kola Ologbondiyan accused the government of concealing officially documented data on debts and the alarming state of the nation’s economy.

    Information and Culture Minister Lai Mohammed, who faulted Atiku’s understanding of the economy, said while the Federal Government welcomed constructive criticism, such must be based on verifiable facts rather than conjectures and innuendos.

    “There is no doubt that former Vice-President Abubakar loves our country and wishes it well; otherwise, he would not have sustained his serial quest for the country’s highest position. One can only hope that his resort to the use of such words as ‘precipice’, ‘foreclosure’ and ‘economic ruin’ does not reflect anything but best wishes for the country at this time,” he said.

    Mohammed said the figure of Nigeria’s debt to revenue ratio of 99 per cent in the first quarter of 2020, quoted by the former Vice-President, is not in the Medium-Term Expenditure Framework and Fiscal Strategy Paper, where he claimed he got it from.

    “We are also not able to ascertain the source of the first quarter figures of N943.12 billion for debt servicing and N950.56 billion for retained revenue, which he also quoted,” the minister said.

    He explained that the nation’s debt service provisions in the annual budgets include principal repayments, interest payments and all other applicable charges.

    “Therefore, the statement that debt servicing does not equate to debt repayment is not only wrong but also ill-informed,” Mohammed said.

    On the former Vice-President’s assertion that revenue needs to go up, the minister said the Muhammadu Buhari administration had introduced several measures to shore up revenues, listing some of them as the passage and implementation of the Finance Act, 2019, current reforms in the Oil and Gas industry, Tax Administration and Collections, as well as the Strategic Revenue Growth initiatives.

    Mohammed also said since Nigeria’s debt service is expressly provided in the annual budgets and the debt service payments are made as and when due, the issue of creditors foreclosing on Nigeria, as “strangely predicted by the former Vice President”, does not arise.

    The minister explained that contrary to the statement credited to Atiku Abubakar that Nigeria had experienced alarming and unprecedented increase in the ratios of debt to the Gross Domestic Product (GDP) and debt service to revenue, indeed, Nigeria’s ratio of debt to the GDP is one of the lowest in the world.

    He said this was at 19 per cent as at December 31, 2019, while government is currently making concerted efforts to increase revenue in order to bring down the ratio of debt service to revenue.

    “One of the reasons debt service to revenue is high is because revenue generation in Nigeria has been low, with over-dependence on the oil sector. This is corroborated by the fact that the ratio of Nigeria’s tax revenue to GDP is one of the lowest in the world – at about six per cent,” Mohammed said.

    The minister explained that unlike what obtained in the past – when the nation borrowed to service the crass indulgence of a few fat cats – the loans being obtained by the current administration are being primarily used to finance infrastructure, such as roads, railways, bridges and power,.

    He added that the loans are long-term in nature, which would benefit present and future generations.

  • Nigeria’s Debt Rises to N27.4trn

    Latest figures released by the Debt Management Office (DMO) showed that adjusted to periodical rates, Nigeria’s total debt stood at N27.4 trillion as at December 2019.

    The latest debt statistics, which were released by the debt office on Wednesday, indicated a 5 percent increase compared to September 2019 figures, which put Nigeria’s total debt profile at N26.2 trillion.

    The DMO explained that the Central Bank of Nigeria (CBN) official exchange rate of N326 per dollar as at December 31, 2019 was used in converting the domestic debts to dollars.

    This means that total debt owed in dollars declined to $84.1 billion in December 2019 from $85.4 billion in September, where a N307/$1 rate was used by the debt office as against a N326/$1 used for the latest data.

    In the instance that the N307/$1 exchange rate had been used in December, the total debt portfolio would have declined to N25.8 trillion in December from N26.2 trillion in September instead of rising to N27.4 trillion recorded at N326/$1.

    The N27.4 trillion included the total external and domestic debt portfolios of the federal government and the 36 states and the Federal Capital Territory (FCT).

    According to the DMO data, a breakdown of the debt showed that domestic debt took the lion’s share of 67.1 percent amounting to N18.3 trillion of the total debt.

    A further analysis showed that Federal Government’s share of the domestic debt portfolio totalled N14.2 trillion (52.1 percent), while in total, all the states of the Federation inclusive of the FCT owe N4.1 trillion (14.9 percent).

    The country’s total external debt was 9.02 trillion, which makes up 32.9 percent of the total debt portfolio.

    Out of the total external debt sum, the Federal Government owe N7.5 trillion, which amounted to 27.5 percent, while the states and the FCT owe N1.4 trillion or 5.4 percent of the total debt portfolio.

  • We borrow constructively in Lagos – Hamzat

    We borrow constructively in Lagos – Hamzat

    The Deputy Governor of Lagos State, Dr Obafemi Hamzat, says a state can “borrow constructively” in order to bridge its infrastructure deficit.

    ”The reality is that where do you get resources to build for today? There is something that is called constructive borrowing and there is destructive.

    ”If you borrow to go and buy a vehicle, you are putting yourself in trouble, but if you borrow to build a house, the house will appreciate and then you can sell even if you are in trouble,” Hamzat said.

    He spoke with the News Agency of Nigeria (NAN) in Lagos in reaction to the state’s debt profile, which it put at N39.692 billion, as at December 2019.

    ”I remember during Asiwaju Tinubu’s government, when they took a bond of N15 billion. The opposition said Oh, he has mortgaged the lives of the young people. That loan has been paid.

    ”During BRF government, we took N375 billion bond, that bond has been paid. Without that, we cannot build Lekki Link Bridge, we can’t.

    ”This Adiyan Waterworks, the reticulation would be N78 billion, we are putting pipe. So where is that money?,” he asked.

    The deputy governor said that Lagos State received about N9 billion monthly from the Federation Account.

    ”By the time you pay salaries, it is N1 billion left. What can you do with N1 billion? Nothing! You cannot build a single road in Lagos with that. So the reality is how do we fund?.

    ”There are statistics that are benchmarks around the world. In Lagos, our debt to revenue is less than 20 per cent. In the United States, it is 89 per cent.

    “But we all go there, you see the airports, we see everything, we like it. But their debt is a whole lot around the world,” he said.

    Hamzat said that what was important was to pay back the loan being borrowed and the state must find a way to build up its revenue and invest in things that allowed it to build the economy.

    He said that during Tinubu’s administration, the cabinet disagreed with his idea of borrowing to expand the Opebi Link Bridge from two lanes to four lanes.

    ”Till tomorrow, all of us, we regret it. We can’t build that, it was supposed to be about N2 billion then, today you will build it with about N14 billion.

    “Where will that come from? So if we had taken that initiative, and built it at that time, the story would have been different in terms of traffic,” Hamzat said.

  • Nigeria debts soar to almost $80bn as World Bank approves fresh $2.2bn loan

    Nigeria debts soar to almost $80bn as World Bank approves fresh $2.2bn loan

    Nigeria’s debt has risen to $80bn as World bank on Tuesday approved nearly $2.2bn loan for the country to invest in six projects, including improving immunization, enabling a stronger business environment for the private sector, expanding the digital economy to promote job creation, and increasing public and private sector capacity on governance and social and environmental safeguards.

    The money for the projects according to reports will come from the International Development Association, the French Development Agency, the European Investment Bank and the federal government of Nigeria.

    According to Shubham Chaudhuri, World Bank Country Director for Nigeria ” The projects focus squarely on delivering better services for Nigerians: ensuring that children are immunized and sleep under mosquito nets; building better roads especially in rural areas, and providing Nigeria’s poorest citizens with a unique identification that will make social safety nets and services more effective.”

    Although the World Bank chiefs tried to focus on the projects rather than the debt and repayment conditions as well as the time it would take to pay back the billions of dollars being borrowed by the Buhari-led government, the new loan pushes Nigeria’s domestic and foreign debt to over $80bn, and comes just a year after the global bank disbursed about $2.4bn to the country.

    Nigeria’s reported domestic debt was already put at $55.6bn and foreign loans at $25bn (a total of $80bn).

  • Alleged N243.9m AMCON debt: Court freezes firm’s account

    A Federal High Court in Lagos has frozen all bank accounts belonging to Sprawling Nigeria Ltd and its two directors, pending the determination of a debt recovery suit brought against them by the Assets Management Corporation of Nigeria (AMCON).

    The directors are Lukman Olawale Ogunyemi and Yetunde Atilade.

    Justice Chuka Austine Obiozor made the order following an ex parte application AMCON filed through its counsel, Olaitan Adeboye, in a suit marked FHC/L/CS/1952/2019, Professor Obiozor also ordered all banks in Nigeria to furnish the court, AMCON and its counsel the respondents’ statement of accounts, stating the total sum standing to their credit.

    The judge also ordered AMCON to, in the interim, take possession all the defendants’ assets, movable and immovable anywhere in Nigeria, pending the determination of the substantive suit.

    He directed AMCON to serve the suit’s originating motion on all the respondents and adjourned hearing till February 5.

    In its application, AMCON alleged that Sprawling and its two directors were indebted to it in the sum of N243, 955, 686.01 million, and all efforts made to recover the debt had proved abortive.

    The agency averred in an affidavit deposed to by one of its Credit Officer, David Funsho George, that the first defendant/respondent was a customer to the defunct Oceanic Bank Plc, while second defendant is the Managing Director of the first defendant and also a personal guarantor of the credit facilities obtained by the company from the defunct Oceanic Bank Plc, while the third defendant is a director in the company.

  • NSCDC recovers N21m debts in Jigawa

    The Jigawa Command of the Nigeria Security and Civil Defense Corps (NSCDC) said it had recovered about N21 million as debts from some residents of the state in the last quarter of 2019.

    The NSCDC Commandant in the state, Alhaji Garba Muhammad, made this known to News Agency of Nigeria (NAN) in Dutse on Friday.

    Muhammad said the amount was recovered following complaints received by the command from aggrieved creditors within the period under review.

    He explained that the command has amicably resolved the disagreements between the debtors and their creditors.

    The commandant added that the recovered funds were handed over to their owners after the resolution of the disagreements.

    According to him, the corps will continue to ensure that residents of the state live in peace and harmony.