Reps query $200m loan bid by NEXIM bank

The House of Representatives Committee on Banking and Currency has queried a fresh bid by the Nigeria Import and Export Bank to secure a $200m foreign loan.Findings on Sunday showed that the committee expressed reservations over the loan bid after it heard that the bank recorded a loss of about N5.6bn in 2009.A source said, "The committee members had met with the Managing Director of NEXIM Bank, Mr. Roberts Orya, at the National Assembly where he told them that the bank was seeking the facility."The money, according to the MD, is to be used for the development of agriculture, solid minerals for export and to make the Nigerian environment attractive to outsiders."However, when the committee heard that in 2009, the same bank lost N5.6bn, members were jolted and began to ask how it would manage the $200m being sought," the source added.Incidentally, the committee also recalled that NEXIM had secured another N18.2bn loan from the Central Bank of Nigeria.The source also said, "The Chairman of the committee, Mr. Chukudi Onyereri, and members expressed worries that the bank could abuse the $200m, considering the fact that it lost N5.6bn in 2009, with an outstanding loan of N18.2bn from the CBN." One lawmaker was quoted as asking, "How can we be sure that the loans or credit facilities you intend to grant after collecting the $200m external loan will not be abused' "How can credit insurance work in the face of the growing negative attitude of Nigerians towards repayment of government-related loans'" But, Orya reportedly clarified that there were no abuses, insisting that the bank was on course in the implementation of its core mandate of promoting investments in exports and imports.Onyereri had advised the bank to strengthen its internal mechanism by ensuring that due diligence was applied in its operations.He noted that whenever due diligence was not observed, people could simply break the rules and walk away freely.
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