RIPPLES OVER NEXIM BANK'S $200M FOREIGN LOAN

BY EMMAN OVUAKPORIE
ABUJA- ATTEMPTS by Nigeria Import and Export, NEXIM, Bank to obtain a $200 million foreign loan has generated ripples in the House of Representatives.

The House Committee on Bank which queried the rationale for the loan, also queried the bank on how it spent the N18.2 billion loan it took from the Central Bank of Nigeria, CBN, stressing that the effect of the money on the operations of the bank had not had meaningful impact on the sector.

At a confab with top officials of NEXIM Bank, the House Committee expressed fears that the move by the bank to begin the granting of credit facilities to firms might be abused.

'How can we be sure that the loans or credit facilities you intend to grant after collecting the $200 million external loan would not be abused?

'How can credit insurance work in the face of the growing negative attitude of Nigerians towards repayment of government-related loans?', the committee queried.

Briefing members of the committee at a meeting in the National Assembly, Managing Director of NEXIM Bank, Roberts Orya, also explained that his bank was to provide credit facilities to encourage the development of export in solid minerals, agriculture and make them attractive for investment.

In a remark, the Committee's chairman, Mr Chukudi Onyereri, said: 'Times have changed and the world economic outlook has become more challenging today than it used to be. The economies that would survive the coming times are those that would live up to constitutionality, due process with strong in-built internal operational and legislative oversight controls.'

'The Committee believes that the safest way to operate and exercise institutional authority is to play by the rules.

'Indeed, the substantive challenge of modern day economic management and regulatory institutions is the need to balance authority with responsibility; the need to come before the Nigerian people with the desired level of transparency, accountability, and appropriate standards of disclosures.

'This times calls for vigilance and improved due diligence; we must eschew the temptations that come with the exercise of excessive discretion. The committee shall seek to promote this.

'It is poised to ensure and facilitate a financial system that is anchored on a viable, strong, accountable, reliable and transparent banking regulation, monetary policy, deposit insurance, banking, asset management and currency regime.

'Our roadmap is extensive, robust and based on effective monitoring and evaluation. We shall be deeply concerned with the quality and depth of internal administrative and accounting controls.

'We shall pay serious attention to early warning signals and shall consistently seek to drive systems review where there are indications of appearance of systems malpractice and corruption.'