The Senate yesterday approved the request by President Muhammadu Buhari to secure a $2.786 billion foreign loan.
The loan is to be sourced from the international capital market as appropriated in the 2018 budget.
The upper chamber also gave its nod to the president’s request to borrow $82.54million to refinance the balance of $500 million matured Eurobond in the international capital market.
The Senate had on Wednesday October 10, 2018 considered Buhari’s request to borrow the funds and referred the matter to its committee on local and foreign debts for further legislative action.
Yesterday, the report on the matter was presented at plenary by the committee chairman, Senator Shehu Sani.
Sani said the committee found that issuance of both $2.786 billion and $82.54 million matured on July 12, 2018 with an interest of 5.125%.
He further stated that both approvals are for the part financing of the 2018 Budget, with particular interest in financing key infrastructure projects.
According to him, the committee however observed that “the external capital raising of $2.786 billion will result in a portfolio mix of domestic debt – 68% and external debt – 32%, which is an improvement over the ratio of 70:30 as at June 30, 2018.
He said the committee also found out that the issuance of bonds will contribute to the implementation of the debt management strategy, which seeks to reduce the cost of borrowing and that it will help to increase Nigeria’s external reserves.
The Senate committee advised that the federal government should reduce or limit its request for more external borrowing and source other means of generating internal revenue.
… Suspends ATM Maintenance Charges
Also, the Senate yesterday directed the Central Bank of Nigeria (CBN) to suspend Automated Teller Machine (ATM) card maintenance charges being deducted from customers by banks.
The directive followed public outcry that commercial banks in the country are making excessive charges on ATM.
The Red Chamber yesterday invited the CBN governor, Godwin Emefiele, to appear and proffer explanations on why official charges approved by the apex bank are skewed in favour of the banking institutions against customers.
Specifically, Senate obliged its joint committee on Banking, Insurance and other Financial Institutions and Finance to investigate the matter and compel the CBN to suspend ATM card maintenance charges being deducted from customers.
The lawmakers are worried that there are several complaints from Nigerians concerning illicit deductions by banks, particularly on ATM maintenance charges.
Consequently, the Senate directed that the mandated committees should probe the propriety or otherwise of the charges to meet international practices.
Noting that the banks also make illicit charges per each withdrawal of N10,000, which is maximum amount through ATM card, the Senate requested commercial banks to quickly reconfigure their ATM machines to allow customers withdraw up to N40,000 at once.
To checkmate the situation, the upper chamber further urged the Consumer Protection Council to look into various complaints of bank customers on excessive charges.
The position of the Senate followed a motion by Senator Gbenga Ashafa (APC, Lagos East) tagged, “Illicit and Excessive Charges by Nigerian Banks on Customers Account with Particular Focus on Automated Teller Machine (ATM) Maintenance and Withdrawal Charges”.
In the motion, Ashafa stated that card users are charged N65 per withdrawal from the ATM after the third monthly withdrawal from the ATM outside that of the domicile bank of the said ATM user. He added that banks manipulate ATM cards and machines.
According to him, “the CBN, in 2017, increased the maintenance fees charged by banks on debit and credit card maintenance from N100 a year to N50 per month (N600 a year) as contained in its Guide to Charges by Banks and other Financial Institutions.”
He informed the Senate that a campaign tagged #Reform9jabanks began on twitter when a UK based Nigerian medical doctor, Harvey Olufunmilayo, lamented about the state of banks in Nigeria compared to those abroad.
Lawmakers who made contributions to the motion said the motion was apt and can ameliorate the plight of bank customers.
Akpabio Demands Saraki’s Impeachment
Meanwhile, despite Senate’s resolve last week Tuesday to abandon partisan issues and sentiments, former Senate minority leader, Senator Godswill Akpabio, yesterday called for the impeachment of Senate President Bukola Saraki.
Akpabio said he will not make any further contribution in the plenary as long as Saraki who is now a member of the opposition Peoples Democratic Party (PDP) presides as the Senate president.
He advised Saraki to take a cue from him and step aside like him (Akpabio) who tendered his resignation letter as minority leader when he defected from the PDP, which is in minority in the upper chamber, to the ruling APC.
Akpabio insisted that in all sphere of life and indeed in democratic setting, majority must always preside over the minority, adding that while minority should have its say, the majority should have its way for peace to prevail.
The former governor of Akwa Ibom who formally defected from the PDP to All APC at a mega rally held at the Ikot Ekpene township stadium on August 8, 2018 also asked that the Senate be properly constituted, saying Senators must sit according to political parties in the chamber.
Senator Akpabio’s reaction followed Senate President Saraki’s refusal to allow Akpabio to make contribution to a debate on the ground that he was not speaking from his rightful seat.
Saraki’s utterance caused temper to flare up among the lawmakers along party lines.
It almost degenerated to a physical combat when Senator Akpabio was denied recognition by Saraki to contribute to a motion raised by Senator Bassey Akpan in which he alleged that APC members in Akwa Ibom State were planning to cause mayhem ahead of the 2019 elections.
Saraki insisted that Akpabio was not sitting in the appropriate seat and won’t be recongnised to speak until he moved to his rightful seat.
Senate leader, Ahmed Lawan, countered Saraki, saying the Senate is not properly constituted, as Senators are not sitting according to political parties in the chamber.
When the deputy Senate president, Ike Ekwetremadu, got up to talk, former majority leader, Senator Ali Ndume interrupted, stopping him from making contributions too.
Senator Dino Melaye stood up and started walking up and down in the chamber scolding and shouting down at any APC Senator wanting to make contribution.
It all began when Saraki said, “Senator… eh… former minority leader, you know you can’t speak from there. You can’t. Go to your seat, when you get to your seat, I’ll recognise you”.
He asked the Leader of the Senate to proceed with other items on the Order Paper, but the Senate Leader, Lawan, stood up to defend Akpabio.
“If he decides to sit there, let him. There is no microphone there. Let us not take the Panadol for his headache. Let me advice that even though we have only six, seven months to go, let’s do what is right”, Lawan said.
At this point, the lawmakers began shouting at each other, as they tried to defend the parties they belong.
Efforts by the Senate president to call the lawmakers to order were unsuccessful, as some of the lawmakers were already on their feet fuming attacking themselves verbally.
When temper was eventually down, Senator Ndume raised a point of order and apologised to Senator Ekweremadu for interrupting him when he wanted to make his contribution.
The Senate president followed suit by apologising to Senator Akpabio, just as he insisted that his not recognising him was not done on grounds of partisanship.
“If you felt offended over the way I put it to you to make your contribution from your seat, I take it back. But it has to be noted that I don’t mean partisan with it’’.
Speaking with Senate correspondents after plenary, Senator Akpabio said, “There is nowhere a group of 10 people ever presided over a group of 80 people. People should emulate my example because I resigned my position as minority leader when I defected from the PDP to APC.
“There is need to restructure the Senate so that PDP, APC, ADC and APGA Senators will sit along party lines. Leadership should be restructured in such a way that minority has its say and the majority has its way.
‘’Senator Bassey said APC was trying to cause mayhem in Akwa Ibom. Does he have evidence? It is like an aggressor trying to turn self to victim. It is not a person that first goes to the Police station to report about a matter that eventually wins in most case.
“It is the PDP raising mayhem, killing and maiming those defecting from it to APC in Akwa Ibom. The very day the APC governorship candidate emerged, he was shot at from the roof of his house. So many other people have been shot at and even wounded or killed in Akwa Ibom. The state commissioner of environment was arrested yesterday for his involvement in the said organized crime in the state”.
FG Okays $2.9bn Eurobond To Fund 2018 Budget
Meanwhile, the federal government yesterday approved for the issuance of $2.9 billion Eurobond to fund capital projects in 2018 budget.
The minister of Finance, Zainab Ahmed, disclosed this after the Federal Executive Council (FEC) meeting presided over by President Muhammadu Buhari at the presidential villa.
She noted that FEC also approved six Transaction Parties to advise the government on the issuance of $2.78 billion Eurobonds and other securities in the International Capital Market (ICM).
The Transaction parties approved by Council are Citigroup Global Market Limited, Standard Chartered Bank as joint manager, FSDH Merchant Bank Limited as financial adviser, White And Case LLP, Banwo and Ighodalo as legal adviser and Africa Practice Limited as technical adviser on communication.
According to the minister, the transaction parties are expected to advise the federal government on the structure and timing as well as documentation for the issuance of the Eurobonds and other securities.
She said the approval is part of government’s commitment to the implementation of the 2018 Appropriation Act adding that “consistent with government’s policy on development of infrastructure, the proceeds of the Eurobond issuance will be deployed to fund critical capital projects in the 2018 Appropriation Act”.
She said, “Today at the Federal Executive Council, we got approval for the issuance of $2.9 billion and other securities in Eurobonds from the international capital market.
“The focus of this approval is to enable us implement the borrowing external plan of N849.67 billion, equivalent of $2.786 billion, which is provided for in the 2018 Appropriation Act and this is to fund capital projects in 2018 Budget.
“We also, as part of that, got approval to raise the sum of $82.54 million to bridge the shortfall of the 500million Eurobond that matured on the July 12, 2018. In addition to this approval for the issuance of Eurobond, we also got the approval for payment to transaction parties and their respective fees like settling bills and expenses.
“We have, as parties for the transactions, two joint league managers, a combination of Citibank group as well as Standard Chartered Bank as joint league managers and FSB Merchant Bank as financial advisers, the White and Case LIP as legal managers and Ighodalo as legal advisers for Nigeria. The total cost for this advisory group is N374,618,889.
Ahmed further hinted that FEC approved livelihood of family improvement project in the Niger Delta.
Stating that the project is called Life and D to be funded with the sum of $60 million that would be a combination of loans and grants, Ahmed said the projects will be implemented in the Niger Delta States of Abia, Akwa Ibom, Bayelsa, Cross River, Delta, Edo, Imo, Ondo and Rivers State.
However, she pointed out that when the government reviewed the project in the nine states, they found that six of the states met their own requirements, while the three that did not will be assisted to enable them improve and join the team in 2019.
On capital release for the 2018 budget, she said, “Let me also move to the question that borders on capital releases. About two weeks ago, N460 billion was released for capital budget”.
On Paris Club Refund, the minister said President Buhari has given approval for the payment of the last Paris Club refund to the states but the approval came with some conditions.
She continued: “Those conditions that Mr President gave is that we must show that the states have used the previous refund for payment of salaries and they will use this one also for payment of salaries.
“The states that were not paid are Akwa Ibom, Rivers and Imo because they had some deficiencies and the agency that is handling it is working to bridge the gap”.
On the controversy surrounding the balance of payment for ex-staff of Nigeria Airways, she said, “The approval given for payment of entitlements to the ex-staff of Nigeria Airways was N45 billion and because of paucity of funds, Mr President gave approval for the payment of 50 per cent of N22.6 billion. We hope in 2019 to pay the balance.”