Ways and Means: Senate insists on total loan recovery

Ignatius Okorocha, Abuja

The Senate Ad-hoc Committee probing the N30 trillion Ways and Means loans to the Federal Government and Anchor Borrowers programme has insisted that the loans must be recovered in full.

Chairman of the Committee, Senator Isah Jibrin (Kogi East) stated this after the meeting of the Committee with officials of the Central Bank of Nigeria (CBN)at the National Assembly on Tuesday.

The CBN team was led by Bala Bello Deputy Governor, Corporate Services made their presentations on Ways and Means and Anchor Borrowers.

Senator Jibrin said the committee was able to extract useful information from them, which will guide their next level of discussion.

He said the committee had issues with approvals in areas where it was discovered that the CBN governor “unilaterally gave approvals”, which is abnormal to the committee.

The committee could not get immediate explanation for that and therefore gave 24 hours to provide the necessary explanation.

“We believe that every approval must be given by the Committee of Governors (COG) i.e the governor and his deputies. That is the standard rule. Where the governor alone unilaterally gives approval that calls for questioning. I think they will provide answers for us very soon.

However, the Anchor Borrowers amounting to N1.1 trillion has an impressive repayment rate of up to 70% performance and the rest 30% of N358 billion are loans given low income farmers with very high risk.

Senator Jibrin said the risk there is that those low income farmers don’t have what it takes to perform to expectation in terms of “equipment, technical know how to manage those farms effectively. That is where we are going to having possible problems of loan default of about N358 billion”.

Therefore, the committee has advised that, to the extent that the loans were processed through the commercial banks, the credit risks lie with the commercial banks, adding that the commercial banks should in turn go after those borrowers to recover their monies.

“We have advised them that they should try into round table discussion with those commercial banks that purportedly guaranteed those loans. To the extent that those loans have been guaranteed and those commercial banks are still in existence, the credit risks lie with the commercial banks and they know what to do”.