By Peter Egwuatu, Assistant Business Editor

Against the backdrop of rising interest rate charged by commercial banks in the country which has made it difficult for both Small and Medium Enterprises, SMEs to thrive, the Bank of Industry, BOI is on track making frantic efforts toward providing credit facilities at low interest margin that would help industries to boost productivity , create employment opportunities and facilitates inclusive economic growth.

The BOI ended the year 2024 on a high note with a landmark fundraising achievement that has helped in boosting its balance sheet.

Specifically, 2024 was the year that BOI mobilized €1.879 billion from the international financial markets, which is the highest amount ever raised by any Nigerian or African Development Financial Institution (ADFI).

The newly raised funding is set to significantly expand the Bank’s balance sheet, increasing it by N3.3 trillion to reach a projected balance sheet footing of N7.1 trillion, up from 3.9 trillion reported in 2023.

By these extraordinary accomplishments, BOI demonstrated its capability to make significant contributions towards providing solutions to Nigeria’s industrial financing challenges.

As one of the major promoters of National Credit Guarantee Company (NCGC) , BOI should be able to deploy more securely the huge resources that it continues to mobilize from the international financial markets by sharing risks with NCGC. Having BOI loans , particularly to SMEs , guaranteed under the new scheme would enable the Bank safely disburse more loans to Nigeria’s private sector.

Meanwhile, addressing the naton in his new year message, President Bola Ahmed Tinubu, commended BOI for its leadership role that it is playing in strengthening not only its credit delivery process but also that of Nigeria’s credit delivery system.

According to the President : “ In this new year, my administration will further consolidate and increase access to credit for individuals and critical sectors of the economy to boost national economic output. To achieve this, the federal government will establish the National Credit Guarantee Company to expand risk-sharing instruments for financial institutions and enterprises.

“ The Company expected to start operations before the end of the second quarter is a partnership of government institutions, such as the Bank of Industry, Nigerian Consumer Credit Corporation, the Nigerian Sovereign Investment Agency, and Ministry of Finance Incorporated MOFI , the private sector, and multilateral institutions.

This initiative will strengthen the confidence of the financial system, expand credit access, and support under-served groups such as women and youth. It will drive growth, re-industrialisation, and better living standards for our people”.

It should also be noted that, recognized for its sound management, BOI has consistently maintained investment-grade ratings by Fitch and Moody’s since 2015, underscoring its reputation as one of Nigeria’s best-managed government institutions. This achievement reflects the quality of BOI’s governance, its financial management and the global confidence in its development mandate.

The €1.879 billion syndication not only drew remarkable interest from a diverse array of international institutions across various countries but also attracted over 10 new international investors, particularly from the Middle East and Asia.

This overwhelming interest underscores BOI’s status as a trusted partner in advancing Nigeria’s industrialization and economic transformation and highlights its growing appeal to investors from emerging markets.

According to analysts and capital market operators who spoke with Vanguard, BOI’s ability to raise €1.879 billion in 2024 is a testament to the quality of its financials.

Analysts stated : “

The 187.9% oversubscription of the syndication highlights the innovative financing achieved through a dual-layer guarantee structure, leveraging support from the Africa Finance Corporation (AFC) and the Central Bank of Nigeria (CBN) for optimal risk-sharing.

This structure allowed BOI to secure much lower interest rates than those typically applied to Nigerian debt instruments, resulting in savings of approximately 3.6% per annum (or an estimated N295.7 billion over the three-year tenor).

These favorable terms will reduce the cost of borrowing for the real sector making it more competitive.
Commenting on the activities of the Bank, the Chief Operating Officer at InvestData Consulting Limited, Ambrose Omordion said : “ The outgone year will go down in the annals of the Bank as the most successful in its 65-year history. Several unprecedented achievements were recorded in 2024”.

Key milestones attained by BOI’s landmark fund raise, according to him include:Largest single transaction done by BOI in its 65 year history; largest deal done by a Nigerian development finance institution;largest deal done by any Nigerian financial institution. ; largest deal done by any African development finance institution thereby setting a benchmark.

Meanwhile, the Managing Director/Chief Executive Officer of the Bank of Industry, Dr. Olasupo Olusi, had noted that the low pricing and favourable terms of the fund raised will ensure that the much-needed low interest and longer tenured funds are available to Nigeria’s growing private sector in line with the vision of His Excellency President Bola Ahmed Tinubu.

According to him: “ The Bank of Industry’s enlarged balance sheet occasioned by the approximately €2 billion fund raise will boost the Bank’s Interventions and Operations and ultimately enhance its developmental impact in the following yays: The €1.879 billion fund raised will go a long way in bridging the current annual development financing funding gap of over US$35 billion (BCG, 2024); Support the implementation of BOI Strategy for 2025 – 2027. One of the key themes is increase BOI financing along several areas to meet Nigeria’s developmental needs. This fund raise provides the capacity for BOI to deliver on its mandate; BOI will seek to address infrastructure challenges which impose a high cost of doing business on manufacturers in Nigeria”.

He added that : “ Infrastructure finance requires long-term and high value financing which the freshly raised fund will support. The confidence in BOI demonstrated by this historic transaction will enhance its ability to access additional sector specific funds particularly funds that are targeted at vulnerable sectors and segments like Gender, Youth, Micro, Small and Medium Enterprises, MSMEs, Agriculture, ESG and Sustainability etc.

“The Bank would also be able more specifically programme and fund impactful projects that will lead to Nigeria’s long term industrial development on a transformational basis due to the flexibility and extent of funding available to BOI”.

Continuing, Olusi said: “ Starting from our humble beginnings as the Investment Company of Nigeria (ICON) in 1959, to the Nigerian Industrial Development Bank (NIDB) in 1964, and finally our transformation into the Bank of Industry in 2001, the Bank has continuously evolved to meet the changing needs of Nigeria’s economy.

In doing so, we have positively impacted the lives of countless Nigerians by supporting businesses, promoting job creation, and facilitating inclusive economic growth.

As Nelson Mandela aptly noted “The past is not merely a place of reference but also a source of inspiration for building the future”.

This principle guides us as we reflect on our history to chart the course ahead in continuing impacting the lives of countless Nigerians by supporting business, promoting job creation, and facilitating inclusive economic growth.”

Highlighting some of the achievements of the Bank, Olusi said: In 2007, BOI’s authorised share capital was increased to N250 billion to put the bank in a position to address its mandate better; this was subsequently increased to N500 billion in May 2023. In recognition of the pivotal role of MSMEs in national economic development, the Bank in 2014 engaged 122 SME consultants and entered strategic alliances with 10 SME-friendly commercial banks. Today, we have over 300 Business Development Service providers supporting SMEs nationwide.

The Bank also has a robust onlending program with various financial institutions, including microfinance banks and fintechs. In 2015, BOI commenced a national footprint expansion by opening eight state offices.

“This drive has continued through the years, and I am proud to say that today, the bank has a presence in 33 states nationwide. In 2017, BOI commenced raising funds on the international market with a US$750 million AFREXIM loan. Since then, we have successfully raised over $5 billion from the international capital markets through Eurobonds, loan syndications, and green finance instruments. This month, we concluded a global loan syndication that raised nearly 2 billion euros which is the largest fundraising in BOI’s history and indeed the largest syndication in the history of African DFIs. One key thread in achieving these milestones through the years is our partners. BOI has established strategic partnerships with key local public and private institutions, as well as global financial and multilateral institutions to enable the bank to fulfill its mandate effectively. BOI partners with State Governments, and Foundations to establish the “Matching Fund” scheme.

“We also have partnerships with trade associations, such as the National Association of Small and Medium Enterprises (NASME), Nigerian Association of Small-Scale Industrialists (NASSI), and Manufacturers Association of Nigeria (MAN), to deepen real sector financing. BOI recently signed a partnership agreement with SMEDAN to provide Nano and Micro Enterprises in Nigeria with a N1 billion fund at a single-digit interest rate. We have partnerships with several other public agencies like NCDMB, to support specific sectors.

In November 2023, the Federal Government of Nigeria appointed BOI as the executing agency for the N200 billion FGN MSME Intervention Fund, which includes a N50 billion Presidential Conditional Grant Scheme (PCGS), a N75 billion Manufacturing Sector Fund, and a N75 billion MSME Intervention Sector Fund. This programme is currently being disbursed and there are numerous stories on the impact on private enterprises.

Our strategic partnerships also extend to numerous organisations, such as African Development Bank (AfDB), the African Finance Corporation (AFC), Investment Climate Reform (ICR) initiative, the African Guarantee Fund (AGF), the Multilateral Investment Guarantee Agency (MIGA), the United States Export-Import Bank (USEXIM), the International Finance Corporation (IFC), etc. and several others.

In the last twelve months, we have also revised our strategy to focus on impact and introduced various strategic initiatives in alignment with President Bola Ahmed Tinubu’s Renewed Hope Agenda and in response to emerging macroeconomic issues.

“In 2024, we introduced our six thematic focus areas to drive developmental impact —Gender, Climate and Sustainability, Youth and Skills, Digital Economy, and Infrastructure. These themes stem from their importance to Nigeria’s overarching development and will guide our financing interventions in the Nigerian economy.

This year, we launched the Rural Areas Program on Investment for Development (RAPID) program, to promote financial inclusion and support the development of micro and small businesses in rural Nigeria, focusing on youth and women. We are improving on our product offerings with plans to scale up Non-Interest Banking (NIB), Export Credit Agency (ECA) and Supply Chain Finance (SCF) with a view to provide adequate financing to various economic clusters, recognising our national diversity to drive economic growth. In alignment with Nigeria’s sustainability agenda, BOI has also launched a climatefocused initiative. As a testament to this, BOI has been nominated as a Direct Access Entity by the Nigeria Climate Change Commission (NCCC) to access financing for climate projects through the Green Climate Fund (GCF).

This designation empowers BOI to spearhead climate initiatives and support sustainable development efforts in Nigeria.

In October 2024, the Bank held its first Inaugural Annual Lecture Series & launched two publications, the BOI Journal of Development Finance (Technical) and the BOI Journal of Development Review (Non-Technical); as well as a price intelligence platform for real-time monitoring of price variations of food commodities across the country.

This platform seeks to enhance transparency and accountability in the food commodity market by providing real-time insights into price trends, stabilising markets, protecting consumers, and informing policy decisions. Beyond the Bank’s efforts, we have also started to implement steps to ensure our subsidiaries are key contributors to national impact.

The BOI board approved a N50 billion recapitalisation of one of our subsidiaries, LECON Financial Services. The new funding will enable LECON to support key sectors and better respond to increasing customer interest in asset acquisition through leasing as an alternative to outright purchasing equipment at a relatively lower cost and longer tenure, taking pressure off business owners. Another subsidiary of the bank, BOI Investment and Trust Company Limited (BOI-ITC), has been re-issued by the Securities and Exchange Commission (SEC), its Trusteeship Operating License. BOI-ITC will re-enter the trusteeship market, focusing on Trusts/Trusteeship Services, Consultancy, Business Advisory, Governance Advisory, and Nominee Services. We have increased the capitalization of BoI Microfinance Bank to enable it to obtain a state licence, rather than its current unit licence. Our people are at the heart of BoI’s strategy.

As a result, we have prioritized staff engagement and improved their welfare through professional development opportunities, employee recognition programs, wellness initiatives, workplace support advocates, and so on.

All these efforts have not gone unnoticed. In the past year, BOI has garnered multiple awards including the EMEA Award for “Best Social Development Program in Africa” for the Investment in Digital and Creative Economy (iDICE), the SERAS Award for “Best Company in Financial Inclusion” and “Most Effective MDA/Parastatal in Sustainable Development,” and the Philips Consulting Ltd. Award for “Best Website and Overall Best Digital Presence for a Federal Parastatal”.

Looking into the future, Olusi said: “We reaffirm our commitment to driving sustainable industrialisation, supporting clients with innovative financing solutions, expanding our partnerships, strengthening financial inclusion efforts, and working closely with government agencies to advocate for policies that foster a supportive business environment, particularly for MSMEs and start-ups, thus, building a resilient and inclusive economy”.