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Palpable apprehension is brewing at the hierarchy of the Bank of Industry (BoI) as the House of Representatives on Monday raised query for the Acting Managing Director of the bank, Mr Waheed Olagunju, to explain the rationale behind granting the N500 billion power and airline intervention fund (PAIF).
Business Hilights recalls that the PAIF was established by the Central Bank of Nigeria (CBN) in 2009, but is domiciled and managed by the BoI
Raising the issue, chairman of the House of Representatives Ad hoc Committee investigating activities of Development Finance Institutions (DFI), Rep. Emeka Anohu (PDP-Anambra) gave Olagunju, a 72–hour ultimatum to furnish them with details or face the wrath of the lawmakers.
According to Anohu, Olagunju should get details of all the airlines that benefitted from the loan and their level of indebtedness, stressing that it was necessary to know how the DFIs had impacted on Nigerians.
In his ruling, the chairman argued that “The DFIs were established to stimulate the economy and one of the ways to know to what extent this has been accomplished is to find out how many Nigerians have benefited from the various intervention funds in these institutions,’’ he said.
Just as members of the ad-hoc committee insisted that the BoI should account for how the fund was utilized, Rep. Chukwuemeka Ujam (PDP-Enugu), Rep. Darlington Nwokocha (PDP-Abia) said respectively that N500 billion was a huge sum of money and private companies that benefited from the policy must be made to account for it.
But responding, Olagunju said: “We have been able to invest about one trillion naira since 2001, in addition to managing the N500 billion Power and Airline Intervention Fund (PAIF), set up in 2009 on behalf of the Central Bank of Nigeria (CBN).
Continuing, he said from the four billion naira approved for Micro Finance banks, we have been able to disburse N3.1 billion till date.
To show how healthy the BoI is, 97 per cent of our disbursed loans are performing.”
Olagunju also informed the committee that the bank was on the verge of completing 100 million dollars solar power project facility from the African Development Bank (AfDB).
Olagunju argued further that because commercial banks cannot play the role of DFIs; and for entrepreneurs and investors to minimise cost of production and other risks, it is BOI’s mandate to support projects in high priority areas by paying lots of attention to game changing projects.