The Central Bank of Nigeria, CBN, has approved the request by the Deposit Money Banks, DMBs, to give financial cushion to 27 state governments battling to meet their fiscal obligations, including payment of salaries of their workers.
The National Executive Council, NEC, had met on Monday, June 29, 2015 and requested for a way out of the financial crunch in some states. The Federal Government offered to help the distressed states and the CBN was asked to look into the matter.
A statement issued by the CBN disclosed that the conditions for accessing the loan facility include resolutions of the States’ Executive Councils authorizing the borrowing and the consent of their Houses of Assembly to the loan package, as well as issuance of Irrevocable Standing Payment Order (ISPO) to ensure timely repayment.
Already, two out of the 27 affected states; Kwara and Zamfara have met the requirements as agreed with their respective banks. The apex bank stated that the 25 others would get theirs in the coming days.
CBN Okays Bailout Plan For Distress States http://t.co/KPe8ml3GAa