CBN processing N656bn bridge financing to spread over 6 months for states—FG

President Muhammadu Buhari has approved a fresh N656 billion Bridge Financing Facility to the 36 States of the federation. Each State would receive N18.2 billion. This is in a bid to help State governments meet financial obligations, especially the previous budget support facility due for repayment. This was disclosed at NEC’s 121st meeting, which was held virtually and was presided over by Vice President Yemi Osinbajo, SAN, with State Governors, Federal Ministers, the Central Bank Governor, and other senior government officials in attendance. The Honourable Minister of Finance Budget and National Planning, Dr Zainab Ahmed, informed the Council that the Bridge Facility is now being processed by the Central Bank of Nigeria (CBN).

The approved Bridge facility of N656.112billion will be disbursed in six tranches over a period of six months to the States.  Expectedly, each of the 36 States will have a total loan amount of N18.225billion; with a 30-year tenor, and a 2-year moratorium at an interest rate of 9%. The Facility is to help the States afford the repayment of previous bailout facilities guaranteed for them by the Federal Government. It will be recalled that on 15th of July, 2021, the Council had received updates on the Budget Support Facility to States. At that meeting, the Finance Minister had informed the Council that the deductions from State Governments would commence soon as repayment for the previous bailout from the CBN. Subsequently, the States sought further support leading to the idea of bridge financing.

Other highlights FINANCIAL UPDATES: The Minister of Finance, Budget and National Planning gave the Council an update on the under listed accounts as follows: Excess crude account (ECA) Balance as at 15th November, 2021 stands at: $60,860,309.33; Stabilisation account Balance as at 15th November, 2021 stands at:  N27,103,662,581.25; Development of Natural resources account Balance as of 15th November, 2021 stands at:  N60, 884,460,981.23