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Energy firms owe Nigerian banks N4trn

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By Michael Eboh

Energy firms operating in Nigeria owe banks in the country about N3.982 trillion as at September 2015, according to data obtained from the Central Bank of Nigeria, CBN.

Counterfeit nairaThe amount accounted for 30.6 per cent of the total N13.014 trillion owed banks by the private sector in the month under review.

The CBN, in its Quarterly Statistical Bulletin for the Third Quarter of 2015, Q3, 2015, disclosed that the indebtedness represented an increase of    14.33 per cent or N499 billion when compared to total indebtedness of N3.483 trillion as at August end 2015.

Also, the amount was 11.45 per cent or N409 billion higher than the N3.573 trillion recorded by the end of December 2014.

Giving a further breakdown, the report stated that downstream, natural gas and crude oil refining companies owed about N2.241 trillion, compared to N1.806 trillion and N2.047 trillion as August 2015 and December 2014 respectively. Similarly, upstream oil and gas servicing companies owed N1.212 trillion, as against N1.217 trillion N1.099 trillion in the same corresponding period.

In addition, Independent Power Projects and power generating companies’ indebtedness stood at N359.568 billion, against N328.38 billion in August and N276.125 billion in December 2014, while power transmission and distribution companies owed N169.4 billion, rising from N131.7 billion and N150.88 billion in the review period.

Sectorial breakdown

*A sector-by-sector breakdown of bank loans revealed as follows:

*Services sector – N5.8 trillion;

*Industrial sector – N4.57 trillion;

*Information and Communication, Transportation and Storage, and General – N2.88 trillion;

*Trade and General Commerce – N1.03 trillion;

*Government – N618.4 billion;

*Construction – N554.25 billion, and;

*Agriculture – N469.9 billion.

Also the banks extended loans and advances worth N392.43 billion to state governments;  N14.99 billion to the Federal Government; and  N4.55 billion to local governments.

Continuing, the report said: “Aggregate credit to the domestic economy (net) stood at N17.176 trillion representing an increase of N452.4 billion or 2.7 per cent and N739.2 billion or 4.5 per cent above the levels recorded a month earlier and at end-December 2014, respectively.

“The increase in credit to the domestic economy (net) was attributable largely to the increase of N519.4 billion or 16.1 per cent in claims on central government (net).    The increase was, however moderated by the decreases in claims on private sector and claims on state & local government by N51.5 billion and N18.0 billion respectively.”

It added: “Net claims on the central Government stood at N3.749 trillion, representing an increase of N519.4 billion or 16.1 per cent above the level recorded in the preceding month. This was attributable to the increase of N237.8 billion or 14.6 per cent in development stocks/FGN bonds and a decrease of N311.2 billion or 38.1 per cent in central government deposits.

The increase in net claims on central government was, however moderated by the decrease in treasury bills by N33.4 billion or 1.4 per cent.


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