CBN Loans To FG Hits N25 Trillion

So far, the Central Bank of Nigeria (CBN) has loaned out the sum of N25.36 trillion to the Federal Government.

Naija News understands that the reported figure was reached following N1.83tn the federal government borrowed from the apex bank in March 2023 through Ways and Means Advances in the year’s first quarter.

Before now, the federal government owed the CBN N23.53tn as of December 2022. The figure was according to the provisional data from the apex bank through its quarterly statistical bulletin.

The Ways and Means Advances is a loan facility used by the central bank to finance the government in periods of temporary budget shortfalls, subject to limits imposed by law.

According to Section 38 of the CBN Act, 2007, the apex bank may grant temporary advances to the Federal Government with regard to temporary deficiency of budget revenue at such rate of interest as the bank may determine.

Small-Scale Businesses To Get Funds In Tune Of N234 Billion

Meanwhile, the Development Bank of Nigeria has raised N23bn bond at 14.40 per cent due in 2028 for small-scale businesses.

According to the bank, its core corporate objective is to use the N23bn to expand its capacity to provide funding for Micro, Small and Medium Enterprises.

The Managing Director of DBN, Tony Okpanachi, while speaking at the signing ceremony on Thursday in Lagos, said that this was the bank’s first local raise since it began to raise funds.

Okpanachi said, “So we have mobilised capital from outside the shore of Nigeria. That was the first step.

“As an institution going forward, we will also be able to catalyse some fundraising within the economy itself to lend to the micro, small, and medium enterprises. We are expanding our funding base beyond the development partners we received funding from.

“Now we are raising funds locally because, if you remember, the need of that segment in the economy is huge.”

DBN exists to alleviate financing constraints faced by MSMEs in Nigeria by providing financing, partial credit guarantees, and technical assistance to eligible financial intermediaries on a market-conforming and financially sustainable basis.

The Executive Director and Chief Financial Officer of DBN, Mrs Ijeoma Ozulumba, noted that about 20,000 small businesses were likely to benefit from this fund. She stated that the fund would help institutions have access to finance.

She added that the rates were affordable and that as the economy improved and interest rates moderated, it would also reflect on the instrument.

Ozulumba said further issuances would depend on the market conditions, the utilisation of available funds, and when shareholders and advisers gave a go-ahead.

DBN noted that its bond was over-subscribed as it set out to raise an initial N20bn debut issuance under its N100bn medium-term note programme.