The Bank of Industry (BOI) is in support of the Federal Government’s plan to establish a development bank in Nigeria.
BOI’s acting managing director, Waheed Olagunju, made this known at a hearing by the House of Representatives panel on the impact of the operations of Development Finance Institutions (DFIs) in the nation’s economy.
When the panel’s chairman, Honourable Emeka Anohu (PDP, Anambra), asked Olagunju of his view on the government’s plan to set up a development bank in Nigeria, the BOI acting managing director said he fully endorses such a plan.
Olagunju while explaining the operations of his bank to the lawmakers, disclosed that over 96 percent of loans issued by the Bank of Industry have been performing.
He said the bank’s interest on loan has been a single digit unlike the commercial banks, adding that “DFIs are policy-based institutions set up to intervene in the markets.
“DFIs grant long-term concessional loans. The interest rates are usually below market rates. At BoI, our SMEs loan is at single digit.”
The ad hoc panel investigating the activities of federally-owned DFIs, said during a hearing yesterday that DFIs should be able to provide succour to Nigeria and Nigerians.
“The DFIs were established to stimulate the economy and one of the ways to know the extent to which this has been accomplished is to find out how many Nigerians have benefited from the various intervention funds in these institutions,” Anohu said.
The planned Development Bank of Nigeria (DBN) is envisaged to operate along the lines of Development Bank of South Africa, Development Bank of China, among others, which have brought about monumental developments in various segments of the economies of their respective countries.