Friday, 7 June 2013

FG approves N750bn for recapitalisation of Bank of Industry

Lagos – The Federal Government has given approval for the recapitalisation of the Bank of Industry (BOI) to the tune of N750 billion.

Mr Joseph Babatunde, the General Manager of the bank, made the disclosure on Friday in Lagos during a training programme for business editors and correspondents.

Babatunde said that he was optimistic that the re-capitalisation would go a long way in turning  around the fortunes of the bank.

Babatunde, however, said that time frame had not been scheduled for release of funds.

He said that the Ministry of Finance and the Central Bank of Nigeria were working on the modalities for its release.

Babatunde said the challenges militating against the effective performance of the bank included under-capitalisation.

“This hindered the bank developmental impact and attraction of needed long term funds from international and multilateral agencies.

“Government, in the last couple of years, has been very proactive in the area of addressing the dearth of long term investable funds required by the manufacturing sector,” Babatunde said.

He said that there were several sector specific intervention funds and schemes in Nigeria today more than ever before in the history of the nation.

Babatunde said the release of the fund would help to enhance the capacity of the bank to provide finance for businesses in Nigeria, particularly the small scale enterprises.

The Managing Director of the bank, Ms Evelyn Oputu, said that the bank had disbursed N238 billion to the operators of Small and Medium Enterprises (SMEs) across the country.

Oputu said that the bank had developed a model that allowed state governments to also contribute to the intervention fund for small and medium scale entrepreneurs.

She said that 20 states had bought into the programme.

The managing director said that the bank had recorded great success in bringing down its bad debt from 70 per cent to 15 per cent.

In a speech at the occasion, Dr Patrick Kormawa, the country representative of United Nations Industrial Development Organisation, said that Nigeria had been involved in bad businesses over the years.

He said that the exportation of crude oil and various unprocessed products abroad would not be in the interest of Nigeria.

According to him, the much touted economic growth has  not reflected in the lives of average Nigerians.

The bank, with a mixed ownership structure, is having N250 billion share capital.

The ownership structure is divided as follows; the Ministry of Finance 59.54 per cent, Central Bank of Nigeria 40 per cent, while private shareholders hold the balance of 0.1 per cent. (NAN)

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