BoI recovers N2.9bn from debtors as NPLs fall to 4.09%

Owing to an aggressive loan recovery exercise and an improved risk management framework, the Bank of Industry (BoI) has cut down its Non-Performing Loans (NPLs) portfolio to 4.09 percent by end of March 2015.

Between January 1, 2014 and March 31, 2015, the development bank has recovered over N2.9 billion from debtors and defaulters.

Ezekiel Oseni, chief risk officer of the bank, said the bank was able to achieve the feat following a review of its processes and risk framework.

According to Oseni, the bank’s induction of some manufacturers in its Hall of Fame, a scheme introduced to honour some of its customers that have shown excellent performance by repaying the loans granted to them conformably as well as the blacklisting of some 24 companies found to be involved in fraudulent practices, aided the recovery process.

He said since the introduction of the Hall of Fame, the bank had recovered N1.3 billion in the last quarter of 2014, while N403 million was recovered between January to March, 31, 2015.

With a target of 3 percent as the maximum level of its NPLs by the end of 2016 in line with global best practices, Oseni said the bank was re-strategising to further ensure that its operations aided the developmental agenda of industrialising the country.

He said the state of NPLs showed a positive outlook, compared with 12.98 percent recorded at the end of December, 2013.

“The Bank of Industry remains the only development finance institution to be rated by any rating agency,” he said, while referring to a recent A- rating of the bank by Agusto &Co, saying “we have opened our books to regulators in order to assess our services so as to serve customers better. We have re-engineered our credit approval process such that it is easy to access loans within five days of submitting applications.

“Similarly, risk mitigation measures have been applied to our processes while human interference has been reduced through the automation process. Our target is to recover N600 million every quarter and a minimum of N2.4 billion yearly. We hope to reduce our NPLs to the barest minimum.”

Rasheed Olaoluwa, CEO, BoI, said while reacting to the bank’s domestic credit rating of A- from Agusto & Co said: “the positive rating is an endorsement of our ongoing transformation project at BoI, and an affirmation of our strategic intent of adopting global best practices in all aspects of our operations.”

He said the bank was determined to make increasing impact in its focus sectors and to continue to set the pace as Nigeria’s leading development bank.