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EKITI PLEDGES TRANSPARENCY IN UTILISATION OF BOND PROCEEDS

By NBF News
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Ekiti State Commissioner for finance, budget and economic development, Mr. Dapo Kolawole, has declared that the proceeds from the N20 billion bond floated recently by the state government will be beneficial to its people.

He further promised that the state government will judiciously use the proceeds of the bond for the projects they were meant for.

The first tranche of the N20 billion bond was oversubscribed by N 0.3 billion through book building in the first tranche of the N25 billion bond issuance programme.

Giving the breakdown of the bond, Kolawole said, 'The bond proceeds which will be utilised in a transparent manner, will also be beneficial to investors. The bond issue is being undertaking under the Ekiti State Bonds, Notes and Other Securities Issuance Law 2011 which makes provision for the establishment of a sinking fund for the purpose of Servicing the State's debt obligations created through the issuance of Bonds. With an issuer and bond rating of BB+ and A from Agusto and BBB and A- from GCR Ratings, the seven year bond has a coupon rate of 14.5 per cent.

Kolawole said the bond utilisation will be 50 per cent developmental and 50 per cent regenerative which means the projects will earn income for the state.

'By the time we came onboard, Ekiti was paying as deduction from ISPO (irrevocable standing payment order) in excess of N426 million but with the bond well structured, we are going to be doing less than N400 million so we have been able to free some money and pay back some of our outstanding debts. What we want to do is to reengineer the economic landscape of Ekiti state by embarking on an ambitious urban renewal phase of Ado Ekiti, the state capital.'

He said the rehabilitation of the Ero Dam and Ado Water Works which will cost about N804.14 million will supply water to 52 towns and villages in the state. 'What the governor has done is to put enough generative power in the dam so now, these towns and villages will enjoy water supply from Ero Dam,' the commissioner said.

As part of effort to refocus the state as an agrarian state, the state plans to invest in the establishment of a school of agriculture at the cost of N750 million. This will boost the agriculture manpower of the state and enhance food production. 'At the end of four years, at least 20,000 Ekiti people would have been trained in mechanised agriculture and we are approaching it from different angles.'

He said about 50 per cent of the bond proceeds which amounts to about N9.68 billion will be spent on road construction to open up the various parts of the state for economic growth. He added that roads within Ado Ekiti, Ise and some other vital roads that will cover at least 14 out of the 16 localgovernment areas.

The commissioner said as part of the income generating projects to be undertaken from the bond proceeds is the construction of a liaison office in Lagos that will cater to the accommodation needs of Ekiti government officials in Lagos.

'It is a liaison office that will be regenerative. In Ado Ekiti, we are building an ultra modern market. We will dualise Ikere road, construct a civic centre which will also generate income for the state' he revealed.