Bailout: 36 States to Share N656bn

*With 30-year tenor, 2-year moratorium at interest rate of 9%

Deji Elumoye in Abuja

President Muhammadu Buhari has approved a fresh N656billion Bridge Financing Facility to the 36 States, with each state receiving N18.2 billion

This was made public Thursday at the  virtual monthly National Economic Council’s (NEC) meeting presided over by the Vice President Yemi Osinbajo and attended by the 36 state governors, the Federal Capital Territory (FCT) Minister, the Central Bank of Nigeria (CBN) Governor, and other senior government officials.

The Senior Special Assistant to the President on Media and Publicity Office of the Vice President Mr Laolu Akande, in a statement explained that the grant was to help state governments meet financial obligations.

Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed,  was said to have informed the Council that the Bridge Facility was now being processed by the 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.

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.

Details later.