Senate approves Buhari’s N22.7trn CBN loan request

The Senate has approved the request of President Muhammadu Buhari to restructure the N22.7 trillion loans borrowed by the Federal Government from the Central Bank of Nigeria (CBN) through Ways and Means Advances.

Leading the debate on the request Wednesday on the floor of the Senate, Ibrahim Gobir, the Senate leader, said that part of the money was given as loans to states.

He said the special committee set up by the Senate to scrutinise the fiscal document, did a “critical analysis and review of submissions made by the Federal Ministry of Finance, Budget and National Planning; and the Central Bank of Nigeria”.

He said: “The panel discovered that the Ways and Means balance was initially N19,326,745,239,660.20 as of 30th June, 2022 but later grew to N22,719,704,774,306.90 as of 19th December 2022 as a result of financial obligations to ongoing capital projects and additional expenditures which includes domestic debt service gaps and interest rate,” he said

Buhari had in December sent a letter to the National Assembly seeking approval to convert N22.7 trillion borrowed from the CBN to 40-year bonds that will be sold to investors at 9 percent interest, with a three-year moratorium.

The Senate considered the request on December 28, but failed to approve it after concerns were raised about the debt, with some lawmakers describing it as unconstitutional.

Few days later, Buhari urged the lawmakers to reconsider their stance on the proposed securitisation of the CBN loans, indicating that interrogation of the composition of the loans could be done after granting approval.

On January 17, the special committee set up by the Senate to liaise with the executive for necessary information on the debt said the attempts made to meet the CBN governor and the finance minister for the required details proved abortive. It asked for additional three days “for thorough work on the assignment and submission of the report.”