James Emejo in Abuja
The failure of the Central Bank of Nigeria (CBN) and the Ministry of Finance Incorporation (MOFI) to pay their equity contributions amounting to N18.22 billion to the Bank of Agriculture (BoA) has constituted a stumbling block to the latter’s discharge of its mandate of employment generation and poverty alleviation, THISDAY has learnt.
It was learnt that while MOFI has outstanding equity contributions of N2.24 billion to the agriculture bank, the CBN is indebted to the tune of N15.97 billion.
The funding constraint was said to have weakened the bank’s loan disbursement capability to farmers  from N7.2 billion in 2010 to N3.2billion in 2011 and later increased to N3.7 billion and N5.6 billion in 2012 and 2013 respectively.
This came as the Chairman of the House of Representatives Committee on Agric Production and Services, Hon. Tahir Monguno (APC, Borno) told THISDAY it would soon sponsor a legislation which will seek to allow BoA to manage all agricultural intervention funds, rather than keep them in the ministry of finance or CBN.
He said: “We are saying we want to diversify our economy away from agriculture and to diversify the economy is not only about input but there’s a need for us to give our farmers access to credit facilities at single digit interest rate; and not from the conventional banks that nowadays charge double digit interest rate.
“So, for us to achieve that, there’s the need for us to recapitalise the Bank of Agriculture (BoA) and call on the Central Bank of Nigeria (CBN) and the Ministry of Finance Incorporated to pay up their equity share so that the bank would be in a position to really achieve their mandate.â€
He expressed concern that two years after government unveiled plans to recapitalise the bank, there had been little progress towards achieving the objective.
However, the BoA which is expected to be recapitalised soon is currently trying to rejig its personnel, and IT among others.
Managing Director/Chief Executive, Bank of Agriculture, Mr.  Kabir Mohammed Adamu had in a submission to the committee on the need to fully subscribe to the share capital of the bank for optimal contribution to the country’s ailing economy, a copy which was obtained by THISDAY lamented that despite presidential approval, MOFI had only injected N27.75 billion over 14 years while CBN had only contributed N4.02billion, bringing total equity contributions to N31.77 billion.
BoA is wholly owned by the federal government through the MOFI and CBN at the ratio of 60:40 respectively.
After the merger in 2000, the president had approved the recapitalisation of the bank to the tune of N50 billion to be injected in four equal instalments of N12.5billion each, payable in four yearsfrom 2001 by the shareholders.
Adamu said the bank’s operations had been challenging largely because of paucity of funds, high overhead with running costs with low level of income caused by lack of loanable funds,  low recovery drive and general economic downturn among others.
He put the bank’s current overhead and running costs at N2.52 billion against an income of N1.39 billion.
The bank is further constrained by high non- performing loans which are yet to be recovered.
