TheNewsGuru

Tag: Loan

  • AfDB denies cancelling Nigeria’s $400m loan request

    …Says ‘we strongly support FG’s economic recovery efforts’

    The African Development Bank, AfDB on Tuesday refuted media reports that it had “called off loans to Nigeria.”

    The report was published by Reuters and credited to the Vice-President of the Bank for Power, Energy, Climate and Green Growth Amadou Hott.

    However, in a swift reaction, the Bank in a statement noted that it was strongly committed to supporting the Federal Government’s recovery effort.

    The statement from the bank reads in full:

    “The African Development Bank wishes to categorically refute the statement that it has “called off loans to Nigeria”, as reported in Reuters and credited to AfDB Vice-President for Power, Energy, Climate and Green Growth Amadou Hott.

    The African Development Bank is highly encouraged by the economic recovery of Nigeria from recession and salutes the Government’s efforts towards diversification of the economy.

    The Bank also strongly supports the Economic and Growth Recovery Plan of the Government and efforts to stem corruption and strengthen fiscal consolidation and efficiency.

    In November 2016, the Board of the African Development Bank approved a $600-million loan to support Nigeria’s efforts to cope with macroeconomic and fiscal shocks that arose from the massive decline in price of crude oil.

    An additional $400 million in support could be considered, if requested and approved by the Board, as part of a larger coordinated effort with other development partners, including the World Bank and the International Monetary Fund.

    The African Development Bank is in consultations with the Government on how best to continue its support for its laudable Economic and Growth Recovery Plan through investment projects that will help address existing structural challenges, including infrastructure, power, agriculture and support to boost private sector and job creation.

    The Bank assures the Nigerian Government of its full support for its continued reforms to diversify the economy and boost economic growth and developmen”t.

  • AfDB cancels Nigeria’s $400m loan request to fund 2017 budget

    The African Development Bank (AfDB) has called off a loan to Nigeria that would have helped fund the country’s budget.

    It has instead redirected the money to specific projects, a vice president at the lender said on Monday, according to Reuters.

    The AfDB had been in talks with Nigeria for around a year to release the second, $400 million tranche of a $1 billion loan to shore up its budget for 2017, as the government tried to reinvigorate its stagnant economy with heavy spending.

    But Nigeria has not met the terms of the international lenders, which also included the World Bank, to enact various reforms, including allowing its currency, the naira, to float freely on the foreign exchange market.

    Rather than loan Nigeria money to fund its budget, the African Development Bank is likely to take at least some of that money and “put it directly into projects,” Amadou Hott, African Development Bank vice-president for power, energy, climate change and green growth, told Reuters in an interview during a Nordic-African business conference in Oslo.

    Because prices for oil, on which Nigeria’s government relies for about two-thirds of its revenues, have risen and the naira-dollar exchange rate has improved, the country is relying less than expected on external borrowing, Hott said.

    No one from the Nigerian finance ministry was immediately available to comment.

    Nigeria’s 2017 budget, N7.44 trillion, is just one in a series of record budgets that the government has faced obstacles funding, pushing it to seek loans from overseas.

    In late 2016, the AfDB agreed to lend Nigeria a first tranche of $600 million out of $1 billion. But negotiations over economic reform later bogged down, blocking attempts to secure the second tranche of $400 million, sources told Reuters then.

    Now, AfDB’s loans will be more targeted, Hott said.

    “It’s hundreds of millions of dollars, just in one go, that we were supposed to provide in budget support, but we will move into real projects … “ he said.

    Earlier this month, the head of Nigeria’s Debt Management Office said the country is still in talks with the World Bank for a $1.6 billion loan, which will help plug part of an expected $7.5 billion deficit for 2017.

    The administration is also trying to restructure its debt to move away from high-interest, naira-denominated loans and towards dollar loans, which carry lower rates.

     

     

  • Ebonyi, BOI float N2bn loans for civil servants

    The Ebonyi State Government has urged civil servants in its payroll to key into the N2 billion loan scheme being operated by the government and Bank of Industry to improve their standard of living.

    Mr Pius Eze, Chairman of the 15-man committee inaugurated by the state government to work out the modalities for the loan disbursement, made the call in an interview with the News Agency of Nigeria (NAN) on Thursday in Abakaliki.

    According to him, the committee has embarked on sensitisation visits to local government areas of the state to enlighten the workers on the importance of keying into the scheme.

    He said that it was difficult under the present economic situation for workers to save about N300,000 and N500,000 from their salaries to start up a business, hence the need to key into the project.

    He said government and BOI contributed N1 billion each into the scheme and stressed that beneficiaries would pay a paltry six per cent interest.

    He said that the loan would assist civil servants to engage in alternative sources of income to better their welfare and economic wellbeing.

    He said that the workers’ monthly pay could no longer sustain them and their families under the present economic situation hence need to diversify sources of income.

    “Thye Governor, David Umahi, is interested in alleviating the plight of Ebonyi workers and that is why he has earmarked N1 billion as loan for workers to access and this is in addition to the N1 billion he attracted from the BOI

    “The loan, which has only six per cent interest, will enable civil servants to invest the fund in any business of their choice which they can fall back on during their service and after retirement from active civil service.

    “The whole idea is to empower the Ebonyi civil servants and enable them to improve on their monthly in come generation by engaging in other alternative sources of income.

    “The Committee has embarked on sensitisation campaigns to local government councils to educate the workers, enhance their understanding and appeal to them to exploit the huge opportunities being provided by the loan scheme, ” Eze said.

     

    NAN

     

     

  • Buhari borrowing $3bn loan to refinance Jonathan’s debt – Adeosun

    The Minister of Finance, Mrs. Kemi Adeosun, has said an appreciable percent of the recent loan request by President Muhammadu Buhari would be used to refinance loans taken by the immediate administration of former President Goodluck Jonathan.

    TheNewsGuru.com reports that President Muhammadu Buhari recently wrote the Senate asking for permission to secure the $5.5 billion external loan.

    Mrs. Adeosun, in a statement by her office, said $3 billion of that loan is to refinance the loan by the immediate past administration.

    Read the ministry’s statement below:

    The Minister of Finance, Kemi Adeosun, on Wednesday revealed that the federal government would apply $3 billion in refinancing the legacy debts of the immediate past government.

    The outlay is part of the $5.5 billion foreign loan being sourced from the International Financial Markets.

    The Minister, who appeared on Arise TV’s News Programme, said the proposed $5.5 billion loan was made up of two components – refinancing of heritage debts to the tune of $3 billion and new borrowing of $2.5 billion for the 2017 Budget.

    She said, “Let me explain the $5.5 billion borrowing because there have been some misrepresentations in the media in the last few weeks. The first component of $2.5 billion, represents new external borrowing provided for in the 2017 Appropriation Act to part finance the deficit in that Budget.

    “The borrowing will enable the country to bridge the gap in the 2017 budget currently facing liquidity problem to finance some capital projects.

    “For the second component, we are refinancing existing domestic debt with the US$3 billion external borrowing. This is purely a portfolio restructuring activity that will not result in any increase in the public debt,” she disclosed.

    Ms. Adeosun further noted that the country’s debt puzzlingly rose from N7.9 trillion in June 2013 to N12.1 trillion in June 2015, despite the fact that only 10 per cent of the budget was allocated to capital expenditure when oil price exceeded $120 per barrel.

    She emphasised that the President Muhammadu Buhari-led administration was investing in critical infrastructural projects such as roads, rails and power in order to deliver a fundamental structural change to the economy that would reduce the nation’s exposure to crude oil.

    “Under this dispensation, we are not borrowing to pay salaries. If all we do is to pay salaries, we cannot grow the economy. This Administration is also assiduously working to return Nigeria to a stable economic footing. In light of this, the government adopted an expansionary fiscal policy with an enlarged budget that will be funded in the short term, by borrowing,” Adeosun stated.

    She reassured that the $5.5 billion foreign borrowing was consistent with Nigeria’s Debt Management Strategy, whose main objective was to increase external financing with a view to rebalancing the public debt portfolio in favour of long-term external financing.

    “Nigeria’s debt to Gross Domestic Product (GDP) currently stands at 17.76% and compares favourably to all its peers. The debt to GDP ratio for Ghana is 67.5%, Egypt is 92.3%, South Africa (52%), Germany (68.3%) and United Kingdom (89.3%).

    “Nigeria’s debt to GDP ratio is still within a reasonable threshold. This Administration will continue to pursue a prudent debt strategy that is tied to gross capital formation. This will be attained by driving capital expenditure in our ailing infrastructure which will in turn, unlock productivity and create the much-needed jobs and growth,” the minister added.

     

  • BREAKING: Buhari seeks approval for fresh $5.5b foreign loan

    President Muhammadu Buhari is seeking the approval of the Senate for a $5.5 billion foreign loan to finance capital projects.

    The request was contained in a letter to the Senate.

    The letter, dated October 4, 2017, was read by the President of the Senate, Dr. Abubakar Bukola Saraki, at the resumption of plenary on Tuesday.

    The letter was read a week after the Minister of Finance, Kemi Adeosun, claimed that the loan request has been submitted to National Assembly for approval.

    “Implementation of the external borrowing plan approved in the 2017 appropriation Act. External borrowing to refinance maturing domestic debts through the issuance of $3 billion Euro bond in the international capital market or through a loan syndication,” the letter read.

    “The senate may wish to refer to 2017 appropriation Act which has a deficit of 2.356 trillion and provisions for near borrowings 2.321 trillion. The Act also provides for 1.254 trillion and external borrowing of 1.067 trillion about $3.5 billion. Issuance of $2.5 billion for financing the 2017 appropriation Act.”

  • FG approves winding down of NERFUND over N17.5bn non-performing loan

    The Federal Government has begun plans to shut down the National Economic Reconstruction Fund (NERFUND) over non-performance and non-performing loans of over N17.5 billion.

    A source at the Federal Ministry of Finance, told newsmen on Thursday in Abuja that a committee had already been formed to ensure smooth liquidation of the company by the end of October.

    The source said that the committee was expected to come up with recommendations concerning the welfare of the NERFUND workers and also what to do with the office equipment.

    The committee was also expected to recommend an agency that would handle the numerous pending court cases initiated by NERFUND to recover billion of naira in bad loans.

    According to the news source, about 1,143 projects in the Small and Medium Enterprises sector were financed with the NERFUND loans between 2010 and 2013.

    The source said that NERFUND currently had problems recovering the loans, adding that out of N17.5 billion, N14.2 billion representing 80 per cent was borrowed by a few people.

    He said the ratio of non-performing loans was high because many of the loans were not collateralised.

    Meanwhile a staff of the NERFUND who preferred anonymity said that all workers of the organisation have been officially informed about the wind up.

    “We have been given the choice to either resign or be sacked. The managing director told us the management is working with the permanent secretary of the federal ministry of finance.

    “They have promised that at the end of the day, we will not be jobless. They will place us somewhere else, so we are expectant,” the person said.

    NERFUND was established by Decree No. 2 of 1989 to act as a catalyst towards the stimulation of the rapid rise of real production enterprises in the country with a seed capital of N300 million.

    In 2002, the Federal Government merged Nigeria Industrial Development Bank (NIDB) and Nigeria Bank of Commerce and Industry (NBCI) to form Bank of Industry (BOI).

    The Federal Government excluded NERFUND from the fusion of all development finance institutions (DFIs).

    However, the agency’s capital had grown into billions of naira, but due to poor management the organisation had been in comatose since late 2013 losing its capacity to carry out its mandate.

    In June 2016 the staff of NERFUND took to the streets to protest the mismanagement of the agency funds.

    The federal government through the Minister of Finance, Kemi Adeosun intervened by first shutting down the agency following failure to reconcile the differences between the executive management and the entire staff so as to forestall a further breakdown of law and order.

    Two weeks after the shutdown. Mrs. Adeosun officially instructed staff to return to work and appointed Ezekiel Oseni in August of the same year to act as Managing Director.

    Just one year into his appointment, the federal government finally approved the winding up of the agency.

     

  • Man attempts suicide in Ogun over N50,000 loan

    Man attempts suicide in Ogun over N50,000 loan

    Security operatives in Ogun have arrested a man who allegedly attempted to commit suicide over his inability to refund a N50,000 ‘loan.

    The man was arrested by the Anti-Vandal Team of Nigeria Security and Civil Defence Corps (NSCDC), Ogun Command, while he was trying to hang himself in a bush on Ayetoro Road, Abeokuta.

    The News Agency of Nigeria (NAN) learnt that the man had tied a rope to a tree and was about hanging himself when a member of the NSCDC team saw him.

    The man, a 34-year old father of five, later told newsmen that he worked with Traffic Compliance and Enforcement Agency (TRACE) in Ogun but was sacked.

    He explained that his inability to perform his responsibility as the head of the family led him to attempt suicide .

     

    He added that his failure to pay the ‘loan from LAPO, a private micro-credit lending organisation, forced him to take the decision to take his life.

    “I am a 200 level drop-out of Federal College of Education, Osiele, I dropped out because I could not get financial assistance to continue.

    “Due to the health problem of my child in 2008, I had to drop out so that I could have some money to take care of my sick child.

    “But, we later lost the child in 2009 because we were unable to pay some hospital bills after people had helped us in raising money for the surgery.

    “I was duped by some people and they even threatened me which made me to leave Abeokuta for Akwa-Ibom state.

    ‘’It was when I came back after a year that I discovered I had been sacked from TRACE.

    “I am frustrated because am owing a lot of people ranging from house bill to electricity bill and some other bills.

    ‘’I am ashamed of myself because am not a responsible man, I cannot cater for my family as a head.

     

    “The LAPO officials have used OPC (Odua Peoples Congress) to arrest my wife because of the money, if not for the help of my pastor.

    ” Am just frustrated because I have to pay N3,000 every Friday and I am presently jobless. And I still have like N24,000 to balance .

    “What added to my conclusion to commit suicide was due to my inability to refund the ‘LAPO’ loan I collected when I wanted to start my tricycle business.

    ” The officials of the LAPO have been giving my family tough times for sometimes now because, I cannot afford to be repaying N3,000 every Friday, “he said.

    He, however, said he regretted his action and wanted a second chance in life./

    “I wish to go back to school; I want the government to help me with a job that can cater for my family and other things that are important, ” the man said.

    Meanwhile, the Public Relations Officer of NSCDC, Ogbonnaya Dyke described it as a crime against the state for someone to try to take his life.

    Dyke added that the suspect would be handed over to the police, after the NSCDC Intelligence Unit had concluded its work.

    “Since the matter is under our Crisis Management Team, we have to swing into action to address the situation.

    ” Necessary actions will be taken by the Corps in addressing the situation. He is going to be handed over to the police after our intelligence Unit has done its work, ” he said.

  • We’ve commenced process of recovering 11bn loan – BoI tells Reps

    The Bank of Industry (BoI) has said that the N11b owed it by 53 debtors will be fully recovered irrespective of litigation by some of the debtors.

    The Managing Director of the Bank, Olukayode Pitan said the recovery drive has already begun.

    The House of Representatives has however requested the Bank to furnish it with details of the recovery of the debt.

    The query for the debt was raised by the 2015 Auditor General’s report.

    At the resumed hearing of the Public Accounts Committee (PAC) Friday, Pitan said the bank had complied with the directives of the Auditor General of the Federation (AGF) on the recovery of the debt.

    In compliance with the directives of the AGF, Pitan said the recovery efforts began immediately with the publication of the names of the debtors in three national newspapers.

    He said: “In addition, we have recovered some money; some of the companies were reported to the Economic and Financial Crimes Commission (EFCC) for recovery.

    “Also, some of them have subjected the recovery to litigation while the property of some of them are on the verge of being sold.”

    Asked to provide exact figures recovered so far, as well as the names of the companies that have taken the bank to court, Pitan said he could not provide the details at the sitting as he had to consult his records.

    On the N2.7b YouWin fund domiciled with the bank for disbursement since 2012, Pitan said the bank could only access N870m out of which N129m was returned to the treasury through the Treasury Single Account in 2015

    Chairman of the Committee, Kingsley Chinda said the House was worried about the huge debt that could affect the objectives of the bank meant to boost the economy.

    In his response, Pitan, who recently assumed office as MD of the Bank said though the debt appeared huge, the bank was prepared for such developments.

    Saying that the bank will not relent in recovery the debt fully, Pitan added, “The bank is not under duress, this does not in any way threaten our business.

    “We are rated and in a healthy position”.

    The Committee also requested the bank to furnish it with the details of transactions on the YouWin programme.

     

  • FG approves N41bn Islamic Bank loan for Katsina

    FG approves N41bn Islamic Bank loan for Katsina

    The Federal Government has approved a loan of $110 million for Katsina state from the Islamic Development Bank (IDB) to enhance health-care delivery in the state.

    The state’s Commissioner for Health, Hajiya Mariatu Bala-Usman at the Annual General Meeting of the Katsina State Chapter of the Nigerian Medical Association said the loan would be used essentially to develop new health care centres and also upgrade existing ones. She made the statement while delivering a paper titled, “Challenges Facing Health Care Delivery in Katsina State and the Way Forward.”

    She admitted that the state has a lot of challenges in health care delivery, and stated illiteracy and ignorance about health related issues as some of the issues that need to be tackled.

    “Among the challenges being faced in the state are late reporting of sickness at hospitals by many people due to ignorance and illiteracy as well as poor post-natal attendance at hospitals by nursing mothers especially after giving birth, for necessary follow ups for new born babies.“

    She also stressed the dilapidated nature of so many of the structures used as health care centres in the state, and the need for more staff to maintain the available facilities.

    Katsina was recently ravaged by a scary flood which destroyed over a hundred houses and left over 2,000 people homeless and is thus currently faced with a lot pressure to improve on the availability of basic amenities in the state.

    The Wazirin Katsina, Prof. Sani Lugga, at the same event also urged medical doctors to consider their work as humanitarian assistance, arguing that doctors’ rewards are both here on earth and in the world beyond.

  • $1.2bn loan: Etisalat Nigeria dismisses investigation reports

    Embattled telecoms company, Etisalat Nigeria has dismissed reports it is under investigation by the EFCC over utilisation of the 1.2 billion dollars loan obtained from a consortium of banks.

    A statement by Mr Ibrahim Dikko, the Vice President, Regulatory and Corporate Affairs, Etisalat Nigeria on the company’s website in Abuja on Thursday described the reports as blatant false and most unfortunate.

    Etisalat Nigeria had obtained a 1.2 billion dollars medium-term seven-year facility for the purpose of expanding its network and improving the quality of service on its network.

    Dikko said that the economic downturn of 2015 and sharp devaluations of the naira negatively impacted on the dollar-denominated loan by driving up the loan value.

    He said that this prompted Etisalat to request a restructuring plan from the consortium.

    He said that the report was most unfortunate considering the damage such misleading information could have on its business and the entire communication industry in the country.

    Dikko said that a simple interrogation of the rigorous process for securing a syndicated loan from a consortium of reputable banks would have exposed the truth to the original writer of the story.

    He said that the concerned parties had access to its books and did not require an investigation into how the loan sum was utilised.

    “It is crucial for the media to correctly inform the general public by providing the relevant micro-economic context Etisalat Nigeria encountered in meeting up with the loan obligation.

    “Contrary to the widely reported misrepresentations about Etisalat Nigeria’s debt obligation to the consortium of 13 banks, it has become pertinent to set the records straight,’’ it said.

    Dikko said that Etisalat had consistently and conscientiously met with its payment obligations prior to this time.

    “As at today, we can categorically state that the outstanding loan sum to the consortium stands at 227million dollars and N113 billion, a total of about 574 million dollars, if the naira portion is converted to dollars.

    “This in essence means almost half of the original loan of 1.2 billion dollars has been repaid,’’ he said.

    He said that Etisalat had continued to service the loan up until February 2017, when discussions with the banks regarding the repayment restructuring commenced

    He further explained that the infrastructure investment and services for which the loan was secured were paid through its banks, adding that these were verifiable.

    “We hereby appeal to our media partners to continue to uphold the ethics of the profession by exercising some restraint particularly in the publication of such misleading and damaging information.

    “We have been accessible and remain available to the media to clarify or verify information when required,’’ he said.