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THE Central Bank of Nigeria (CBN) has told state governments to act as good debtors by paying the debts that they owe to both commercial banks and the apex bank in order to be creditworthy.
At the end of its Monetary Policy Committee (MPC) meeting on Tuesday, CBN Governor, Mr Godwin Emefiele also disclosed that the bank retained the Monetary Policy Rate (MPR) at 11.50 per cent along the asymmetric corridor at +100/-700 basis points around the MPR; CRR at 27.5 per cent; and Liquidity Ratio at 30 per cent.
Answering questions after reading the communique, Emefiele said the debts owed by the states were in two categories: “there are intervention facilities granted by the bank and there is a bilateral facility granted by the deposit money banks to them.
“They went to deposit money banks, they asked for loan, they signed the offer letters with those banks, they gave an Irrevocable Standing Order to the Federal Ministry of Finance that on a monthly basis MOF should deduct from their monies and pay the banks for the loans they have taken.
“I am aware that the banks have written to Finance and they have copied me that they want their money. “If it was the bilateral agreement, in fact, the privacy of contract here, I am not part of it so they should pay their loans.
“On the CBN intervention facility to the state governments, we are engaging the National Economic Council and CBN is also insisting on its loan to be paid but after the outcome of engagement between CBN, Finance and NEC we will begin to take the monies but, in any case, it is good for you to be a good debtor.
“If you take a loan, you pay so that when you go back to the bank you can get but if you refuse to pay, you will never smell the doorstep of the banker again”, he declared.
