Commercial banks are demanding a repayment of loans to state governments.
Their resolution is supported by the Governor of the Central Bank of Nigeria (CBN) Godwin Emefiele, who insists that states must pay back all the loans extended to them by Deposit Money Banks (DMBs) and the apex bank.
The commercial banks have written to the Federal Government to start deducting the loans from allocations going to the states under the Federation Account.
Emefiele told reporters at the end of the Monetary Policy Committee (MPC) meeting in Abuja, yesterday, that there was no going back on the repayment of the loans.
The CBN boss said: “There are two aspects to this (the loans). There are intervention facilities granted by the CBN and there are bilateral facilities granted by the DMBs to state governments.
“State governments went to DMBs and asked for loans; they signed the offer letters with those banks. They gave the instructions to the Federal Ministry of Finance that on a monthly basis, the ministry should deduct from their monies and pay the banks for the loans they have taken. “The banks have written to the finance ministry and they have copied me that they want their money.
Emefiele said: “It was a bilateral agreement. In fact, because of the privacy of contract here, I am not part of it. So, they should pay their loans.”
