BoI denies granting unsecured loans

The Bank of Industry (BoI) has denied granting unsecured loans, saying 93 percent of the credits issued are backed with guarantees.

In a statement issued on Thursday, BoI said it does not give out loans without collateral security.

The lender said its books are examined by the Central Bank of Nigeria (CBN), the Auditor-General of the Federation and KPMG.

The bank said it follows a strict credit policy which involves issuing of bank guarantees as well as Federal Government’s bonds/treasury bills.

These, according to BoI, cover 93 percent of its loan security.

It added that the remaining 7 percent involves legal mortgages and/or debentures as well as guarantees.

The statement read: “Foreign and local lenders to BoI require the bank to utilise these collaterals for lending as a condition for their lines of credit. So, all the monies we borrow overseas are safely sterilised with the Central Bank of Nigeria (CBN).

“Also, all on-endings from the foreign loans are first verified by CBN before the subsequent release of funds is made.”

The bank stressed that its non-performing loan was three percent as at December 31, 2020.

“This was less than the CBN’s 5 percent or less requirement,” it added.