Nov. 19, 2021

In a bid to help State governments meet financial obligations, especially the previous budget support facility due for repayment, President Muhammadu Buhari has approved a fresh N656billion Bridge Financing Facility to the 36 States.

In a statement on Thursday by the Vice President’s spokesman, Laolu Akande, this was disclosed at the National Executive Council’s (NEC) 121st meeting,  held virtually and was presided over by Vice President Yemi Osinbajo.

The Honourable Minister of Finance Budget and National Planning, Dr Zainab Ahmed, informed the Council that the Bridge Facility is now being processed by the Central Bank of Nigeria (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.

It would be recalled that 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.