State governments have obtained around N26.31 billion in loans from the Excess Crude Account facility, which is designed to be used for building infrastructure and carrying out development projects.
The Punch reported that as of June 30, 2023, three banks’ accounts held a combined amount of almost N183.1 billion in excess crude account facility deposits.
This was less than the N209.41 billion that was in the banks’ coffers as of June 30, 2022, a decrease of N26.31 billion.
The conclusions were drawn from an examination of the H1 financial statements for 2022 and 2023 from Zenith Bank Group, Access Bank, and Guarantee Trust Holding Company.
The remaining amount owed by the Excess Crude Account to the State Governments serves as collateral for the lending facility.
The facility, which has a 20-year tenor and is due monthly, is priced at 2% per year payable to the CBN.
The States are given a loan at a rate of 9% per year, totaling all fees.
Upon the issuance of an Irrevocable Standing Payment Order by those states, the principal is repayable monthly from the Federal Account Allocation Committee allocation of those states as a first-line charge.
According to information obtained by the report, the facility’s rate was reduced from 2% to 1%, and the loan’s maximum rate from 9% to 5% as a result of a CBN forbearance owing to the COVID-19 outbreak.
The Punch further noted that GTB had a total of N14.05 billion on the facility as of the H1 2022 financial statement.
The following is an excerpt from the financial statement: “The amount of N14,046,582,000 (December 2021: N13,978,609,000) represents the outstanding balance on the concessionary loans granted by the Central Bank of Nigeria to State Governments for the execution of developmental and infrastructure projects.”
The entire sum fell to N12.53 billion by the first quarter of 2023: “The amount of N12,527,523,000 (December 2022: N12,928,726,000) represents the outstanding balance on the concessionary loans granted by the Central Bank of Nigeria to State Governments for the execution of developmental and infrastructure projects.”
It indicates that some states probably withdrew about N1.52 billion from the bank, significantly less than the N10 billion intended for each state to remove, making it the account with the lowest withdrawal.
Access Bank’s H1 2022 financial report indicated an outstanding amount of N111.43 billion, which was reduced by N12.39 billion to N99.04 billion by H1 2023.
In H1 2022, Zenith Bank had an outstanding balance of N83.93 billion; by H1 2023, it had dropped to N71.53 billion.
Zenith Bank saw the largest withdrawal on this lending facility, with a decrease of N12.4 billion.
However, between June 30, 2022, and December 31, 2022, the total balance in the Access Bank account fell by a huge N99.45 billion to N11.98 billion.
According to FAAC communiqués, the overall balance in Nigeria’s Excess Crude Account substantially declined from $35.377 million as of June 24, 2022, to $473,754.57 by June 2023, a decrease of 98.67%.
The Punch also learned that the Federal Government spent $35 million to buy two High Endurance Offshore Patrol Vessels before the end of June 2022, while $0.01 million was collected as interest on funds invested between March and May 2022.
Earlier, the Hashemite Kingdom of Jordan contributed 107 armoured vehicles, which the Federal Government refurbished and remodeled for a cost of $11.56 million.
The budget implementation report states that this was accomplished in the second quarter of 2021.
Earlier this year, the previous governor of Nigeria’s Central Bank revealed that 35 states had asked for Excess Crude Account-backed loans.
