Appraising Osidi’s Leadership

Sunday Ehigiator

Over the past year, Shehu Usman Osidi’s leadership at the Federal Mortgage Bank of Nigeria (FMBN) has been marked by a clear vision, strategic innovation, and significant achievements.

These efforts have improved the Bank’s operations, expanded its reach, and strengthened its impact on the housing sector.

Key areas of focus included delivering essential housing projects, enhancing access to mortgage financing, expanding the National Housing Fund (NHF) Scheme, and driving digital transformation to improve service delivery. These initiatives have led to substantial institutional reforms and increased homeownership opportunities, ultimately shaping the future of mortgage banking and affordable housing delivery in Nigeria.

Increased Operational Performance/Financial Impact

It is instructive to note that the overarching objective of the Bank is the provision of Mortgage loans to Nigerians to buy or build houses. Over the past year, the Bank has lived up to expectations within its capacity, if current records are anything to go by.

Within the period, the Bank recorded an operational surplus of N11.58 billion based on the Management Accounts for 2024. This is the first such experience since FMBN came into existence over 30 years ago.

Although this figure is expected to come down significantly when impairment is applied, the bank has set out to tackle all aspects of its operations that lead to high impairments, especially in tackling the high non-performing loans inherited by the current Management, and pursuing with great efforts the recapitalization of the bank. A grossly inadequate capital of N2.5 billion hinders the capacity of the Bank to perform optimally.

Under the National Housing Fund (NHF) operations, collections grew by N3 billion in 2024, resulting in a total collection of N103 billion compared to the N100 billion the Bank recorded in 2023. This increase in NHF contributions demonstrates renewed trust and participation in the NHF scheme by Nigerian workers.

To further illustrate the improvements, a total of 658 employer organisations and 178,619 employees were registered in 2024 compared to 556 and 113,577 respectively in 2023.

New Products Development

Over the last year of Shehu Osidi as Managing Director/Chief Executive Officer of FMBN, some new products came to being. This was in line with its mandate of providing innovative housing solutions to Nigerians.

The newly introduced products include the Diaspora Mortgage Loan, Rent Assistance Loan and the Non-Interest Loan. These initiatives were all designed to cater to the diverse needs of Nigerians and expand access to affordable housing.

The Diaspora Mortgage Loan is a strategic collaborative initiative between FMBN and the Nigerians in Diaspora Commission (NiDCOM). This initiative is expected to open up opportunities for Nigerians living abroad to invest in real estate back home in Nigeria.

Also, there are ongoing engagements between the Bank, NiDCOM and the Central Bank of Nigeria (CBN) aimed at ensuring seamless transaction processes.

International Money Transfer Operators (IMTOs) are also being engaged to facilitate smooth transactions, with plans for a full rollout of the product expected in Q1 2025.

The NHF Diaspora Mortgage Loan Scheme is expected to further expand the scope of mortgage accessibility, driving down the housing deficit facing the county.

Another product recently introduced is the Rent Assistance Loan, a micro-housing loan product meticulously designed to alleviate the financial burden of rental payments for eligible Nigerians.

This product was crafted to ensure accessibility, affordability and flexibility, making it a viable solution for many who have found it challenging to secure housing finance through other traditional financial arrangements. It is also expected to be launched within the first quarter of 2025.

Additionally, the FMBN under Shehu Osidi’s leadership has introduced the Non-Interest Loan, also at the verge of being launched within quarter 1 of 2025. This product is specifically designed for Nigerians who are averse to interest payment, particularly Nigerians of low and middle-income status.

Improved Service Delivery

The FMBN has made significant strides in improving its service delivery over the past year. Under the leadership of Osidi, the Bank has prioritised efficiency and customer satisfaction, leading to notable achievements in turnaround time and loan approvals.

One of the most notable achievements has been the reduction in turnaround time for loan approvals and disbursements, which has been cut down to an average of 30 days. The Bank’s digitisation efforts have played a crucial role in streamlining its processes.

The deployment of digital platforms like the Core Banking Application has significantly reduced bureaucratic bottlenecks, allowing loan applications to be processed online and ensuring faster and more transparent service delivery. This shift to digital platforms has also enhanced the Bank’s ability to monitor and evaluate its operations, leading to better decision-making and resource allocation.

In addition to digitisation, the Bank has introduced ‘mystery shopping’ as a strategic tool to improve customer service delivery and enhance customer experience and satisfaction.

This has brought about more effective and efficient responsiveness to inquiries and complaints, ensuring that customers’ needs are met promptly. As a result, customer satisfaction ratings have improved over the past year.

Strategic Partnerships and Collaborations

The bank has also made significant strides in strategic partnerships and collaborations over the past year. Recognising the importance of collaboration in achieving its goals, the FMBN has forged partnerships with key stakeholders in the housing and financial sectors, including state governments, labour unions, real estate stakeholders, and international housing finance institutions.

These partnerships aim to expand the Bank’s network, leverage multilateral resources, and attract Foreign Direct Investments (FDIs) into the Nigerian mortgage market.

One notable partnership is with Shelter Afrique Development Bank, which focuses on developing affordable housing for student populations across Nigeria.

The Bank is also exploring partnerships with organisations like the International Union of Housing Finance, Association of African Development Finance Institutions, and African Alliance for Youth Empowerment.

These collaborations have opened up new avenues for funding and technical support, enabling the Bank to expand its operations and deliver on its mandate more effectively.

The FMBN’s partnership initiatives have yielded significant results, including the signing of a Memorandum of Agreement (MoA) with the Kano State Government to re-integrate Kano State civil servants into the NHF Scheme.

With 35 states now on board the NHF scheme, the Bank has ensured wider access to mortgage financing for Nigerian workers, addressing the housing deficit in various regions. The FMBN is also collaborating with private developers to deliver affordable housing projects across the country, providing shelter for thousands of families.

 Affordable Housing and Job Creation

The bank has also made progress in delivering affordable housing units to Nigerians under Osidi’s leadership. In the past year, the Bank has financed the construction of over 1,044 housing units across the country, with 6,853 ongoing projects in 106 locations.

These units are strategically located in both urban and rural areas, ensuring that low- and middle-income Nigerians have access to decent and affordable housing.

The Bank’s commitment to affordable housing is reflected in its provision of N100 Billion as an off-taker guarantee for the Renewed Hope Cities and Estates Programmes.

This initiative, championed by the Federal Ministry of Housing and Urban Development, aims to deliver 3,112 housing units in Karsana, FCT. Additionally, the Bank provides loans to contributors to the National Housing Fund (NHF) Scheme, enabling them to access affordable housing.

The FMBN’s efforts in affordable housing delivery have not only improved access to housing but also contributed significantly to national productivity and economic growth.

The Bank’s initiatives have created approximately 171,325 jobs across Nigeria, benefiting engineers, architects, surveyors, artisans, and other stakeholders in the housing and real estate sector. This has had a positive ripple effect on the standard of living and economic growth.

Vision 2025

Speaking about the Bank’s plan for this year, Osidi said, the bank plans to “Review of the FMBN 5-Year Strategy Blueprint, review and update of operational policies to align with global best practices in housing finance, and strengthening internal audit and compliance mechanisms to reduce operational risks.

“Our aim is also to increase the branch network to facilitate extensive mobilisation of the informal sector, enhance financial inclusion and promote effective and more efficient service delivery.

“In this regard, rather than continue with the present structure where the Bank’s branches are located in only State capitals, we will identify commercially viable locations with strong informal sector presence and open new branches in those locations to bring our services closer to the people.”

Looking Ahead

The first year of Osidi’s leadership at the FMBN has been a game-changer. The Bank has undergone significant transformation and growth, achieving impressive milestones in housing delivery, mortgage loan accessibility, digital transformation, and institutional reforms.

With strategic initiatives in place, FMBN is poised for further growth in 2025 and beyond, reinforcing its commitment to expanding homeownership opportunities for Nigerians.

Osidi’s tenure has laid a strong foundation for a more efficient and impactful mortgage financing system in Nigeria, making homeownership dreams a reality for many. As the Bank continues to drive growth and innovation, it’s exciting to think about the possibilities that lie ahead for FMBN and the Nigerian housing market.