BoA laments ₦37.4 billion MSMEs, others debt
The Bank of Agriculture (BoA) has lamented that it is being owed ₦37.4 billion out of its current loan portfolio of ₦47.2 billion by Micro, Small, Medium Enterprises (MSMEs) and large scale beneficiaries both in agricultural and non-agricultural sector.
Its Managing Director/Chief Executive Officer, Kabir Mohammed Adamu stated this when he received on oversight function, the Senate Committee on Agriculture led by its chairman, Senator Abdullahi Adamu.
He said: “Our current loan portfolio is ₦47,212,810,354.05 to MSMEs and large scale both on agricultural and non-agricultural beneficiaries out of which the sum of ₦10,760,166,960.90 has been repaid with ₦37,449,480,101.02 is still in default.”
The BoA chief also identified insufficient funding and the lack of inclusion in the Federal Government’s budget for its recurrent and capital expenditure as major challenge hampering the performance of the bank.
Adamu who said the bank has been a special purpose vehicle towards the development and execution of the Federal Government Agricultural Agenda, also lamented the lack of loan repayment from organisations, groups and farmers.
Other challenges he identified include failure of the shareholders, Federal Ministry of Finance Incorporated and Central Bank of Nigeria (CBN) to pay their equity contributions which he said amount to ₦18,221,252,456.00.
He also identified other factors inhibiting the organization to include weak capital base, lack of lending resources, information technology, staff related challenges, old and dilapidated structures and inability of tenants to pay their outstanding rents, poor office ambiance and high non-performing loans where other challenges.
In view of the challenges, the BoA chief appealed to the committee to help make a case to President Muhammadu Buhari to provide funding on sustainable basis to allow the bank manage all agricultural interventions and other natural resources funds especially rice levy, wheat levy, sugar levy among others.
“The National Assembly can also assist BoA by making legislations that would allow the bank to manage all Agricultural Interventions Funds such as the National Housing Funds being managed by the Federal Mortgage Bank of Nigeria and cement subsidy by the Bank of Industry (BoI),” he said.
The bank also urged the committee to prevail on the shareholders, Federal Ministry of Finance Incorporated, CBN to pay up their equity contributions and prevail on the Federal Ministry of Water Resources to release ₦1,386,000,000.00 being repayment of loans granted to it and it’s parastatals, and for the Federal Government to make budgetary provisions for administrative cost of the bank.
Responding, Senator Adamu assured that the needful will be done to ensure that the bank is assisted in any way possible to enable it perform optimally and efficiently.
He however urged the management of the BoA to formally present the challenges writing, assuring that the committee will make a case to Mr President accordingly.
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