Debtors dare CBN as deadline expires

Some deposit money banks (DMB) yesterday said while some debtors are now servicing their debts, a significant number have refused to pay or service their debts in spite of warnings by the Central Bank of Nigeria (CBN). Our correspondent gathered from some of the banks that some of the debtors have paid large parts of […]

Some deposit money banks (DMB) yesterday said while some debtors are now servicing their debts, a significant number have refused to pay or service their debts in spite of warnings by the Central Bank of Nigeria (CBN).
Our correspondent gathered from some of the banks that some of the debtors have paid large parts of their debts while others have negotiated new terms of repayment.
The CBN in circular BSD/DIR/GEN/LAB/08/022 dated April 22, 2015 asked the banks to give a three-month deadline to all loan defaulters from May 1 to settle their debts or get their names published in newspapers. 
In the circular signed by the CBN’s Director of Banking Supervision, Mrs Tokunbo Martins, the rising trend of non-performing loans (NPL) has been observed in the industry.
Furthermore, banks and discount houses are required with effect from May 1 to give the debtors three months grace to turn their baccounts from non-performing to performing status. 
CBN statistics show that about N400 billion non-performing loans out of the N13 trillion total loans in the country are recorded which is equivalent to 3 percent of the total credit.
Speaking to our correspondent yesterday, First Bank spokesman, Mr. Babatunde Lasaki, said some debtors had begun repaying the bank.
According to him, there is a significant improvement but there are substantial others who have refused to pay.
He said the bank is currently compiling the list of bad debtors and would publish their names from Monday.  He however said he didn’t have the value of the total debts paid to the bank at the moment.  A top official of Ecobank confirmed that some of the bank’s debtors had also started repaying their debts.
He said by next week, those that refuse to pay would have their names and directors in their companies published.  A source in UBA said: “Yes, some are paying. But some have negotiated new payment terms with the bank. We are looking at the debtors on a case by case basis and negotiating individually. But the window for that will close Friday (today) after which, we will be set to publish the names of defaulters from Monday’’.
Daily Trust reports that among the top defaulters are oil and gas companies,  construction firms, importers, manufacturers and agro businesses.