Senate Investigates N483bn Loan Disbursement

The Senate has commenced investigation into an alleged uneven disbursement of intervention loans to the tune of N483 billion by Development Financial Institutions in the six geopolitical zones.

This is just as the Senate has raised a 7- man Ad- hoc Committee to probe the matter and report back in four weeks.

The chairman of the investigative committee is David Umahi. Other members are senators; Babangida Oseni, Ali Ndume, Sani Musa, Tokunbo Abiru, Ipalibo Banigo and Chizoba Chukwu.

This followed the debate of a motion by Senator Ali Ndume (Borno South) which was supported by 64 other senators on the need to holistically investigate the disbursement of loans by Development Bank of Nigeria, NIRSAL and related banks to micro, small and medium scale enterprises (MSMEs) in Nigeria from 2015 to date.

Recall that the same motion by Ndume and three others was investigated by an ad- hoc committee in the 9th Senate and a report was submitted by the panel headed by Senator Sani Musa (Niger East).

Deliberating on the motion at plenary yesterday, the Senate noted the huge disparity and uneven distribution of half a billion Naira to states in the six geopolitical zones of Nigeria and the states in the country in 2021 by the Development Bank of Nigeria .

„Aware that the Bank‘s Annual Integrated Statutory Report 2021 obtained on 13th July, 2022 from the organisation‘s website showed that the Bank disbursed a loan worth Four Hundred and Eighty Three Billion Naira (N483,000,000,000) only out of which only 11 percent went to the 19 states of Northern Nigeria, while 47percent went to Lagos State alone.

„Also aware that the 13 percent of the loan that went to the North totals about Fifty Three Billion , One Hundred and Thirty Million Naira (N53,130,000,000) while the 47 percent that went to Lagos State alone totals Two Hundred and Twenty Seven Billion and Ten Million Naira (N227,010,000,000) only.“

According to the breakdown of the loan presented by Sen Ndume, „the South West got 57 percent worth N274,740,000,000; South South got 17 percent worth N81,940,000,000; North Central got 11 percent worth N53,020,000,000; South East got 9 percent worth N43,380,000,000; North West got 5 percent worth N24,100,000,000; North West and North East got just One percent worth N4,820,000,000.“

The Development Bank of Nigeria exists to alleviate financing constraints being faced by micro, small and medium scale enterprises (MSMEs) in Nigeria through providing finances, partial credit guarantees and technical assistance to eligible financial intermediaries on a market – conforming and fully financially sustainable basis.

Ndume also noted that the top five sectors considered for the loan were oil and gas (42.0 percent), manufacturing (16.0 percent) agriculture, forestry and fisheries (7 .2 percent), trade and commerce (6.3 percent), and transportation and storage (3.5 percent),

However, there was mild drama as senators took time to dissect the motion. Seriake Dickson (PDP Bayelsa) while suggesting an additional prayer asked that the Ad- hoc investigation should be extended to look at all intervention loans by the CBN including Covid- 19 palliative, Anchor Borrows loan etc.

But the additional prayer was dropped on the ground that it will make the assignment of the ad- hoc committee unending.

Contributing earlier, Sen. Orji Uzir Kalu (Abia North) said loans are gotten upon application and following satisfaction of requisite requirements including bank guarantees.

Olamilekan Adeola (Ogun West) said Ndume had the notion that his North East zone was short changed but forgot that the development financial institutions had laid down procedures to disburse loans but appealed that the motion be given a second look if Ndume felt bad about the facts.

Sen. Sani Musa (Niger East) who headed the former ad- hoc committee said it should be noted that there is a difference between bank loans and palliatives.