Jaiz Bank’s Director solicit for more Sukuk bonds
Managing Director, Jaiz Bank Plc, Mr Hassan Usman, has advised the Federal Government to devise a regular Sukuk issuance programme to secure much-needed capital to boost infrastructural development and end the menace of abandoned projects.
The Federal Government recently successfully floated its first sovereign Sukuk bond, raising ₦105 billion, ₦5 billion over-subscription on the initial target of ₦100 billion.
Speaking at the 3rd African International Conference on Islamic Finance in Abuja, Usman said issuance of more Sukuk bonds would provide government with pool of capital finance infrastructural projects across the country while asset-based nature and financial discipline that come with Sukuk bonds will ensure timely completion of any identified project.
According to him, Sukuk ensures discipline in the management of resources because there is always a structure to guide the process. As such, issuance of more Sukuk bonds will not only provide the huge quantum of funds needed to address infrastructural problems in the country but help to improve efficiency in public finance.
“We have so many things that we need to address, from roads to railways, seaports, airports, hospitals, education and so many other things yearning for attention; which the normal budgeting system cannot address. We need to raise quantum of funds to address them. Issuing Sukuk gives you two things-you get the resources and get disciplined around it. Money from Sukuk is dedicated for what it is intended for. It is very unlikely for that money to be diverted out of those projects,” Usman said.
He added that issuance of Sukuk will help Nigeria to address both financial inadequacy and structural deficiencies in public administration as every issuer of Sukuk will need to have a definitive structure in place for the utilization of the fund, which must be followed to the letter.
“That for me is something Nigeria needs, because it would mean the end of abandoned projects. Before you raise Sukuk, you must have done your homework – you have gotten the contractors, you have done the bills of quantity- money is available and the contractor would go to the site and every certificate is paid for. So, Sukuk for me is the way to go to address many of our challenges,” Usman said.
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