"> #COVID-19: #BOI Rolls out Strategy for Industry Supports - Sahel Standard
August 3, 2020
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#COVID-19: #BOI Rolls out Strategy for Industry Supports

The Bank of Industry (BOI) is reviewing its strategic priorities to ensure continuous support for enterprises, especially those hard hit by the COVID-19 pandemic.

Specifically, it is deepening penetration in agro-processing, food processing, technology, healthcare, and pharmaceuticals to stimulate economic recovery and growth.

The bank’s managing director, Mr. Kayode Pitan who disclosed this at a webinar on overcoming business challenges presented by the COVID-19 pandemic, said it is an additional response to the significant changes in the global and local operating landscape.

Soon after the outbreak of the pandemic, the bank responded with a number of measures to reduce the economic impact on customers. Among them, the bank reduced interest on its direct line of credit by 2% for one year from April 1, 2020, to March 31, 2021; granted a three-month moratorium on principal repayment to all beneficiaries of the BOI Fund from April 1, 2020, to June 31, 2020; with the option to extend by up to 12 months for customers with proper justification on a case by case basis.

For loans issued under the Central Bank of Nigeria (CBN) intervention programme and in line with a CBN directive, the bank reviewed interest rate downwards to 5% per anum, with a 3-month moratorium. Also thee bank worked with the Nigerian Content Development Management Board (NCDMB) to reduce interest rates on credit facilities approved under the Nigerian Content Intervention Fund from 8% per anum to 6% per anum, including extension of the moratorium period.

More directly, BoI made financial contributions to the relief efforts of governments and the organized private sector. At the webinar, Mr. Pitan noted that Nigeria, like many countries around the world, has not been immune to the economic headwinds created by the COVID-19 pandemic and has therefore been impacted with a revenue shortfall and the fear of possible recession; low investor confidence; downgrade of credit ratings and difficulty in funding social intervention programmes due to reduced revenue projections.

He said many SMEs are expected to have challenges staying operational due to cash-flow constraints, and that will likely increase unemployment, reduce productivity, and increase social tensions.

Looking ahead, the Managing Director of Nigeria’s oldest and largest Development Finance Institution said it is reviewing further sectoral peculiarities and extent of the impact of the pandemic on areas such as manufacturing; oil and gas; cinemas/entertainment; and hospitality for the development of tailored long-term palliatives; increasing business advisory support for given current headwinds; and deliberately seek out alternative countries for future sourcing of raw materials and equipment.

On the felicities of the CBN to lenders, he said there will be continuous engagement with the apex bank on current intervention funds and new ones targeted at weaker sectors following the pandemic; and in collaboration with the Federal Government, improve social intervention for micro-enterprises, for example, through the GEEP programme.

BoI will also proactively engage its international lenders given the current headwinds and ensure the availability of needed funding to support planned developmental support.

With on-lending partners, he said the bank is engaging them to review rate and tenor of their BOI loans, thereby encouraging them to do the same for their customers; and also engaging BOI guaranteeing banks regarding the restructuring of BOI loans. Mr. Pitan advised that businesses will need a sound understanding of the “new normal” to survive and indeed thrive following the COVID-19 pandemic.((VON)

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