The Senate Ad-hoc Committee investigating the N30 trillion Ways and Means on Tuesday insisted on recovery of loans offered by the Central Bank of Nigeria and Commercial Banks to the Federal Government of Nigeria in the last administration.
The Committee chaired by Senator Jibrin Isah representing Kogi East Senatorial District, at the commencement of investigation, interacted with officials of the Central Bank of Nigeria, and called for recovery of all pending and unserviceable loans or have the funds deducted at source.
The investigative mandate of the Committee covers loans, drafts and advances to the FG under “Ways and Means”, and the “Anchor Borrowers Programme”, which gulped the economy to the tune of N30 trillion.
The CBN, officials led by the Deputy Governor in charge of Corporate Services, Bala Bello offered some useful tips while being interrogated by the Chairman of the Committee, and other panelists, on how funds were released on the request by the Federal Government.
Documents released by the CBN officials to members of the Committee show how the Apex governor unilaterally approved release of funds when it ought to have been done by the Committee of Governors, COG.
The development irked members of the Committee, with the Chairman explaining that useful information has been extracted that will guide the Committee in the next level of discussion.
Senator Isah maintained: “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 an immediate explanation for that and therefore gave 24 hours to the CBN team 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 calls for questioning. I think they will provide answers for us very soon,” he said.
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 to 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 expectations in terms of “equipment, technical know-how to manage those farms effectively. That is where we are going to have possible problems of loan default of about N358 billion”.
The committee stated 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,” he added.
N30 trillion Ways and Means: Senate urges banks to go after loan defaulters
