Joe Effiong, Uyo,
The management of Federal Mortgage Bank of Nigeria (FMBN), has decried the low capital base of the bank which it says has grossly affected the bank’s performance.
The Managing Director of the bank, Mr. Ahmed Dangiwa, who said this during the two-day 2019 Board and Management strategy development retreat of the bank held, in Uyo, Akwa Ibom state, also disclosed that until very recently, the FMBN did not have a strategic plan on how to move forward.
Dangiwa said the problems confronting the bank was the reason for the retreat, which main aim was to fine-tune their 5-year strategic plan so that FMBN would not only be seen as a social housing provider , but also as a mortgage institution that can provide commercial housing in the country.
“We want the bank to not only provide social housing, we want to commercialise it and recapitalise it. It is a well known fact that the bank is undercapitalised with N5 billion. Out of the N5 billion, only N2.5 billion has been fully paid; the other N2.5 has not been paid.
“So some of these primary mortgage banks that usually depend on us for financing, they are relying on the N5 billion and the CBN has jacked it up to N7 billion. FMBN has been struggling to survive. So this discussion we are going to have in the next two days, is going to be based on how we can survive.”
Apart from low capital base, the FMBN boss also said the the bank was also hampered by operational legal framework.
“That is why we went to the National Assembly to ensure that even the legal framework that established the FMBN is changed to position it properly. I am sure you are aware that the National Assembly has passed the two bills and are awaiting Presidential assent.’’ The MD said. The Chairman of the bank, Dr. Adewale Adeeyo, said the strategy retreat which came after 15 years, is a another laudable achievement of the current board.
‘‘Not withstanding the lack of a strategy document over the years, it is on record that the bank has introduced some modest innovations to develop its business and by extension the mortgage industry. For instance, it promoted the FG mass housing delivery programme though the creation of the Estate Development Loan window to advance construction funding to real estate developers; it pioneered capital market in Nigeria when it raised almost N40 billion in mortgage-based bonds to refinance mortgages for Nigerians to purchase non- essential FG residential houses in the FCT following the Monetisation Programme; it championed the use of housing co-operatives to reach the informal sector and attempted to spearhead diaspora mortgages, to mention a few .”the chairman said. He explained that the bank has been working with KPMG Advisory Services which commenced the 5-year strategy plan development project in April, 2019.
“My expectation is that by the close of business, we would have exhaustively exercised the power in our hands to shape the future of the FMBN positively. I believe that whatever the outcome of this retreat may turn out to be, as critical stakeholders, , we will, within our individual spheres of influence, be willing champions in the implementation of the 5-year Strategy Plan when finalised,” Adeeyo said.