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Tag: BoI

  • Build industrial parks, BoI advises state govts

    Build industrial parks, BoI advises state govts

    The Bank of Industry (BoI) has advised state governments to build industrial parks in all the Senatorial Districts in the country.

    Its Acting Managing Director, Mr. Waheed Olagunju  who gave the advice during the visit of the Director-General, Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), Dr. Dikko Radda in Abuja, stated that the move will help to democratise entrepreneurship in the country and   reduce operating cost.

    He said: “We advise our governments, both the national and sub-national levels, to build industrial parks; if we have industrial park in each of the Senatorial Districts, we would have gone a long way in democratising entrepreneurship in Nigeria.

    “With government providing the needed amenities in the parks, it reduces start-up cost of SMEs. It also reduces their operating expenses;  when they are localised, they share knowledge, skills and they mutually reinforce one another. The output of one serves as the input for the other. When they are in a location, it also makes credit administration also easier. Doing that would substantially de-risk SMEs.”

    As part of the policies to stimulate the growth of MSMEs sector, Olagunju urged the government to initiate procurement process that mandates various agencies and ministries to buy from local producers.

    “Most MSMEs don’t have the budget to face the market, to get their goods sold; in solving this problem, some countries across the world have come up with procurement policies in favour of MSMEs to say that between 30 and 40 per cent of government procurement must come from MSMEs. We need the policy like that in Nigeria,” he said.

  • Enterpreneurship will solve economic problems, says BoI

    Enterpreneurship will solve economic problems, says BoI

    The Bank of Industry (BoI) has identified entrepreneurship as one of the ways to take the economy out of the woods.
    Its Acting Managing Director, Waheed Olagunju in a presentation at the second day of the first National Forum on the Economy organised by Vintage Press Limited, titled National Economy: The Way Forward, said the time has come for action having been speaking about challenges and pains.
    Represented by the GM, Joseph Babatunde, Olagunju said if the SMEs are encouraged, more jobs will be created.
    He said research by SMEDAN had shown that there are 37m SMEs in the country, adding that if they are encouraged and each of them employs one person, its multiplier effect would be tremendous.
    He said Nigeria is number 3 next to US and India in the movie industry, adding that if the strength of the country is explored in the area of the production of goods and services for which the country has comparative advantage, the economy would prosper.
    He said BoI is working with the CBN and the International Finance Corporation (IFC) to develop credit bureau and collateral registry to ease access to funds to SMEs.

    According to him, the bank is also working towards the building of industrial parks, adding that the bank also has cottage agrofund, fashion fund, Nolly fund and the N5m microfinance fund.
    He urged governments at all levels to address the issue of multiple taxation.

  • 13,272 youths apply  for BoI’s N10b

    13,272 youths apply  for BoI’s N10b

    The Bank of Industry (BoI) received 13,272 online applications in two weeks for its N10 billion facility earmarked for on-lending to small businesses, following the unveiling of its Youth Entrepreneurship Support (YES) programme.

    BoI’s Acting Managing Director and Chief Executive, Waheed Olagunju, hailed the receipt of over 13,272 online applications as at April 1 – two weeks after the scheme was launched.

    He said the figure was in excess of the 10,000 applications  projected to be filed in six weeks, adding that it showed wide acceptance of the YES programme among youths.

    Olagunju explained following the enthusiastic response to the scheme, the bank and its 11 partnering development institutions were taking steps to increase the number of applicants to attend a five-day capacity-building sessions at eight centres in the country.

    The BOI chief added that the fund size would also be increased to meet the number of applicants that could “potentially be transformed into successful entrepreneurs, in the required critical mass and ultimately employers of labour”.

    The initiative, which was designed to address youth unemployment in the country, would see the bank partnering 11 development institutions in building capacity of youths by equipping them with the requisite knowledge and skills.

    BoI will fund their business plans to enable them to be self-employed and manage their businesses.

     

  • Assessing Olaoluwa’s stewardship at BoI

    Assessing Olaoluwa’s stewardship at BoI

    After 21 months in the saddle, the stewardship of the former Managing Director of Bank of Industry (BoI), Mr. Rasheed Olaoluwa, has come under scrutiny. Although the verdict of most players who appraised his performance is that the former BoI boss was on course. Others feel that he could have done more to position the bank to drive industrial development. Assistant Editor OKWY IROEGBU-CHIKEZIE examines the tenure of the former head of Africa’s largest Development Finance Institution (DFI).

    He may not have finished his tenure as the Managing Director (MD) of Bank of Industry (BoI), having been appointed in 2014. But within the 21 months Mr. Rasheed Olaoluwa held sway as head of Africa’s largest Development Finance Institution (DFI), his performance has come under intense scrutiny by players and operators in various sectors of the economy.

    Would history be kind to Olaoluwa for re-jigging the bank’s board to reflect its real sector intervention agenda and unveil new products while also boosting operational efficiency?

    Perhaps, more importantly, has the bank under his charge delivered on its mandate of driving Nigeria’s industrial development? To what extent has BoI promoted, nurtured, supported and monitored Small and Medium Enterprises (SMEs), which have been acknowledged as economy’s growth engine?

    How far did he go in bridging the financing gap for SMEs and helping them write bankable proposals to enable them obtain loans from commercial banks at single digit interest?

    These are some of the critical questions that formed the basis of measuring or appraising the bank’s performance under Olaoluwa’s 21-month stint at the foremost DFI. Many industry experts and key stakeholders, who spoke with The Nation, say that despite the relatively short time he was in charge at the bank, the former BoI boss was able to bring his wealth of experience in the engineering, accounting and banking sectors to bear on his job of pushing the bank to its enviable position among other African DFIs.

    Some of them also pointed out that given the avalanche of new and innovative financing options that have come the way of businesses especially SMEs in the last 21 months, as well as the democratisation of access to capital and spirited efforts at scouting for consultants to help SMEs write bankable proposal, Olaoluwa acquitted himself well.

    Yet, there are others who aver  that BoI under his leadership may have successfully changed the nation’s financial intermediation landscape with new products.

    For instance, the Chief Executive Officer (CEO) of Spectra Foods Limited, an indigenous manufacturing firm, Mr. Duro Kuteyi, described Olaoluwa as a professional to the core. He said the former BoI MD rode on a good structure he met on ground and utilised it judiciously. Hear him: “Before he came, there was a structure; if there is a good structure on ground, one appears to be a superstar, but if the structure is bad, no matter what you do, it will be bad and you can’t finish well. We should congratulate those who put the structure in place.”

    Kuteyi gave reasons to justify his belief that Olaoluwa left marks in the sands of time after piloting the affairs of the bank. He pointed out, for instance, that the former BoI chief was instrumental to the tremendous support members of the National Youth Service Corp (NYSC), graduates and entrepreneurs now enjoy in the form of soft loans with single digit interest rate.

    Kuteyi also told The Nation that the signing of a service agreement with 122 Business Development Service Providers (BDSPs) to collaborate with BoI to identify credible SMEs that require finance was a game changer. According to him, the intervention enhanced SME’s efficiency.

    The BDSPs, according to him,  have also been helping SMEs develop bankable business plans and proposals to facilitate their access to finance including providing post-finance services such as mentorship, handholding, financial advice and inculcation of best practices among others.

    Experts say that poor packaging of loan requests and non-bankable business plans are responsible for the low level of financial support to the SME sector. But as Kuteyi observed, “BDSPs have made it easier for SMEs to better package their products.”

    However, assisting SMEs package their products and facilitating their access to loans were not the only interventions that gladdened Kuteyi and indeed, other stakeholders’ hearts. Apart from the fact that BoI under Olaoluwa brought down the rate of non-performing loans from 18 per cent to about four per cent, the bank also substantially improved its operational efficiency with an upgrade of its system and introduction of mobile applications.

    Specifically, BoI repositioned its systems, processes and services by riding on the back of robust technologies and products. This was in the hope of taking advantage of the new digital and mobile world to offer its customers the benefits of speed, mobility and convenience that come with it. For instance, BoI in partnership with Kinesis Consulting Limited developed an SME Accounting Application (SAAPP), which allows users keep proper records of transactions as well as generate requisite financial statements.

    SAAPP, The Nation learnt, is a user friendly, simplified and menu-driven accounting tool that does not require formal accounting knowledge by the entrepreneur. With the software, SME customers will be empowered with business information on their mobile phones. Because of its unique features and benefits, the application enjoys the buy-in of operators and stakeholders.

    For instance, SAAPP allows BoI SME customers to easily generate basic financial statements such as balance sheets, which report on the SME’s assets, liabilities and ownership equity; profit and loss accounts, which report on the SME’s operation in terms of income (sales), expenses and profit or loss; cash flows, such as SME’s operating, investing and financing.

    Interestingly, one of the key features of SAAPP is the integrity of the financial statements generated on it. Once financial statements have been prepared, they cannot be altered at will. Consequently, it is the same statements that will be produced for submission to the tax authorities, statutory government agencies and financial institutions.

    The App also contains a link that enables the SME mail the financial statements directly to BoI. The App is programmed for installation on a maximum of three devices per business entity and is available at a pocket-friendly price of N20, 000.

    Beyond BoI’s shot in the arm of SMEs, observers also say that the bank under the former MD ignited a revolution in the industrial sector through effective management of several intervention funds that targeted one segment of the industrial sector or the other.

    Some of them include the N100 billion Cotton Textile and Garment (CTG) Fund, for the revitalisation of the CTG industry along the entire value chain; N10 billion Rice Intervention Fund, to ensure Nigeria attains self sufficiency in rice production; and Africa Development Bank (AFDB) $500 million Line of Credit, for the development of export-oriented Small and Medium Enterprises (SMEs).

    Others are: Federal Ministry of Women Affairs and Social Development (FMWASD) N90 million Business Development Fund, to provide soft loans to women entrepreneurs; Central Bank of Nigeria (CBN) N220 billion Intervention Fund, for Micro, Small and Medium Scale Enterprises (MSMEs); National Automotive Council’s N16.91 billion Fund, for the development of the automobile industry sub-sector; and N2 billion Sugar Development Council Fund, to ensure Nigeria attains self-sufficiency in sugar production by 2020.

    By riding on the back of such intervention funds to drive Nigeria’s industrialisation, Olaoluwa was hoping to bridge the developmental gap that separated developing economies like Nigeria from the developed countries.

    Under his watch, BoI also surpassed its benchmark in profit making. For instance, on the day of the announcement of his removal from office, the bank announced over 100 per cent turnover in its profit earnings for the December 31, 2015 financial year, representing a profit after tax of N12 billion.

    The bank, which hinged its improved profitability on operational efficiency during the financial year, also disbursed loans worth N83.5 billion to 776 enterprises (47 large enterprises and 729 (SMEs) in the year.

    A breakdown of the bank’s earnings for the year showed that it recorded an unaudited Profit Before Tax (PBT) of N50.4billion for the year ended December 31, 2015, representing an operating profit of N12 billion up by 100 per cent from N6 billion achieved in 2014.

    The bank explained that the loans to large enterprises went to companies in Nigeria’s real sectors such as agro-processing, food processing, solid minerals, gas value-chain, engineering and technology and light manu-facturing.

    According to the bank, the loans for small and medium enterprises were disbursed to companies in the various SME clusters such as fruit juice, cassava processing, fish farming, bakery, furniture, among others, adding that the loans resulted in the creation of over 90, 000 jobs in 2015.

    “The bank’s operating results are underpinned by strong growth in the bank’s balance sheet, improvement in the bank’s non-performing loan ratio from 18 per cent in May 2014 to four per cent in December 2015, and efficient cost management, which saw the growth in operating expenses limited to only 12 per cent in 2015″,  a statement from the bank said.

    Speaking on the result, Olaoluwa said: “I feel very proud of what we achieved in 2015.We made significant developmental impact through the disbursement of over N83 billion to nearly 1000 enterprises.

    ‘’We inaugurated two of the six rural solar micro grid projects we financed. We introduced many products and programmes to support the SME ecosystem.

    “We obtained our ISO 9001:2008 Quality Management System Certification. We also secured our first ever international rating from Fitch Ratings (BB-) and Moody’s (Ba3), moving the bank closer to global best practices. We are grateful to all our development stakeholders for their continuing support especially the Central Bank of Nigeria and our 200 BDSPs.”

    However, some stakeholders are quick to point out some areas where they believe the former BoI boss could have done better. For instance, an SME operator, who declined to be mentioned, accused the bank’s management under Olaoluwa of being selective in giving loans to operators. According to him, it easier for a camel to pass through the eye of a needle than for a small business operator who does not have link with a top member of the bank’s board to obtain loan from the bank for business. He said the process of getting loan from the bank was more rigorous under his tenure.

  • Unemployment: BoI’s ‘YES’ project raises youth’s hope

    Unemployment: BoI’s ‘YES’ project raises youth’s hope

    As part of measures to tackle unemployment, the Bank of Industry (BoI) has unfolded a N10 billion Youth Entrepreneurship Support (YES) programme. It is expected to create 36,000 jobs yearly. TOBA AGBOOLA reports.

    Unemployment, arguably, is one of the most critical socio-economic problems  facing Nigeria. According to the latest report by the National Bureau of Statistics (NBS), about 1,972,722 Nigerians have been unemployed since June last year. The Federal Government, however, appears determined to tackle the problem.

    Through the Bank of Industry (BOI), the government has launched the N10 billion Youth Entrepreneurship Support (YES) programme. The scheme is expected to produce at least 36,000 direct and indirect jobs annually, with each beneficiary getting between N5 million to N10 million loan at nine per cent interest rate with a tenure of five to 10 years.

    At the launch of the programme in Abuja, the Acting Managing Director of BOI, Mr. Waheed Olagunju, said the programme aimed at equipping youths to become self-employed by starting and managing their own businesses and eventually becoming employers of labour. While noting that Micro, Small and Medium Enterprises (MSMEs) are the bedrock of any economy, he said there is need to develop the capacity of the youths with a view to ultimately fund their business plans.

    Olagunju said while previous empowerment programmes for the youths concentrated more on training, the YES project will provide funds for the beneficiaries. According to him, it is a critical success factor in the establishment of small businesses. “The capacity building programmes also hardly take care of the entire training value chain. The YES scheme that is being launched today would therefore, provide an opportunity for BOI to address the worrisome phenomenon of lack of finance,” he said.

    Olagunju highlighted some of the bold steps taken by the Bank in recent times to address some of the developmental challenges facing the country. The most recent, he said, was the merit-based N2 billion financial inclusion scheme for youths known as the Graduate Entrepreneurship Fund (GEF). The GEF, launched by the Bank in October 2015 in partnership with the National Youth Corps Directorate, is the precursor to YES.

    “GEF is targeted at serving members of the National Youth Service Corps (NYSC). The programme is an innovative approach aimed at tackling the social malaise of graduate unemployment. The strategy was to identify the innate talents of the young graduates as soon as they leave school, build their capacities for self-reliance and also empower them to establish their own businesses;  thereby creating jobs not just for themselves, but for other youths that they may employ. Indirect jobs would also be created as a result of ventures promoted under GEF,” the BoI boss explained.

    Explaining further, he said the programme entailed an online business ideas competition in which 3,100 serving members of the NYSC made their submissions out of which 1,000  top scorers emerged. The successful candidates, he said, underwent entrepreneurship capacity building programmes in seven locations in the six geopolitical zones of the country, including the special centre in Lagos, to facilitate access to finance for their business plans.

    The Minister of Industry, Trade and Investment, Mr, Okechukwu Enelema, said government will continue to grasp with the sharp decline in revenue from crude oil, which has been the main stay of the economy. He, however, said the nation should not be unmindful of the opportunity the situation presents.

    “It is very important we look inwards in this period and look at ways of exploiting the entrepreneurial spirit and the zeal of  our people. The intense energy of our large youthful population is a strength that we need to exploit by re-orientating them towards positive engagement in entrepreneurship. The nation’s unemployment rate has assumed a worrisome level in view of its implication for national development and competitiveness,” the minister said.

    Speaking with The Nation, one of the beneficiaries of the first phase of the scheme, Mr. Vincent Chinedu, said with the introduction of the portal, it will be easy for anybody to apply unlike before when it was difficult. He said it was not easy when he initially started because of the stringent collateral. He, however, said BOI has relaxed the condition, adding that this will encourage and help others to apply for the loan.

    Chinedu said he graduated as a Chemical Engineer in 2012/2013 and instead of looking for job, he applied for the loan with his NYSC certificate. With the presentation of two guarantors, he said he was given the loan. Today, he is the Chief Executive Officer (CEO) of Nedhills Industries. “We are into palm kernel oil production and I have five people working for me at the moment. I am planning to employ more people because we are expanding,” he said.

  • GEF scheme: BoI shortlists 311 for N600.5m loan

    Following the completion of its appraisal for applications under the Graduate Entrepreneurship Fund (GEF) Programme, the Bank of Industry (BoI) has shortlisted 311 business proposals for funding.

    The financial intermediation exercise, which would see the bank providing N600.5 million for small businesses under the GEF scheme, is expected to provide intervention to 28 SME clusters out of the identified ones in the country.

    According to the bank, a breakdown of the applications received showed that theer was  even spread across the six geo-political zones, with the South West ranking top with 130 applicants, requesting for N252.5 million, followed by the North Central, with 57 applicants requesting N110.2 million in loans and the North West ranking third with 42 applicants requesting N83.4 million.

    Others are South South, with 42 applications for N82.8 million, South East had 23 applicants requesting N38.47 million and 17 North East applicants requesting N33 million.

    “After screening of the applications, 1,000 candidates were selected for the three-day capacity building programme which was held at seven designated training centres in Lagos and across the six geopolitical zones of the country.

    “The three-day training programme was facilitated by top nine BOI partner Training Institutions in Nigeria and the Institutions have continued to provide advisory/mentorship support to the candidates in the processing of packaging their loan applications. This gesture from the respective trainers and the intensiveness as well as quality of the 3-day training has made it possible for many of the participants to submit bankable loan applications.

    “An online loan application portal was subsequently commissioned to enable the 800 candidates that successfully participated in the 3-day training submit their applications for a maximum loan amount of N2 million. At the expiration of the deadline of February 15, 2016 set for the submission of loan applications, a total of 311 candidates submitted financing requests for an aggregate sum of N600,545,781.26.

    “The nine partner training institutions will continue to hand-hold the young entrepreneurs through the early stages of running their businesses to ensure proper utilization of the loans, viability and sustainability of their respective ventures”, the bank explained.

  • BoI set to reduce unemployment

    BoI set to reduce unemployment

    The Bank of Industry (BOI) is poise to reduce the level of unemployment, the  Acting Managing Director Waheed Olagunju has said.

    He said part of the strategies to achieve the goal would be to give grants to viable business ideas that will stimulate growth, noting this was part of the reasons it signed a Memorandum of Understanding (MoU)  with 11 training institutes.

    Under a new programme, Youth  Entrepreneurship Support (YES), youths between the ages of 18 and 35 would be supported with grants from a limitless pool of funds to start their businesses.

    He said the need to provide jobs for the youth was the reason for the programme that would be commodity-based industrialisation.

    Areas of comparative advantage, such as agricultural, solid minerals, Information Communication Technology (ICT) and the creative industries, would be focused on.

    On why the scheme did not have a financial ceiling, he said: “For every billion naira spent by BoI, 4000 jobs can be created; value addition is the key. We spent N2million for GEF which is the pilot programme, but for this, all funds at our disposal will be made available as we have the backings of our stakeholders to deepen our service delivery.”

    “We now have an Executive Director for MSME’s which shows government’s  renewed efforts to grow the economy through MSME’s as we realised supporting them will provide more jobs to Nigerians unlike the big chain enterprises that employ less”.

    He said the YES scheme was a BOI initiative designed to address youth unemployment in Nigeria by building the capacity of youths by equipping them with the requisite entrepreneurial knowledge and skills,as well as funding their business plans, which would enable them to be self-employed and manage their own businesses as “participants must have a minimum educational qualification of an Ordinary National Diploma (OND) or its equivalent”.

  • Gombe community gets BoI, UNDP solar power

    The Bank of Industry (BoI)  in partnership with United Nations Development Fund, (UNDP) has provided electricity for over 200 homes through  the national grid in Gombe State.

    Its Acting Managing Director,   Waheed Olagunju said the N44million rural electrification project is being financed by the bank and the UNDP.

    Speaking during the commissioning of the project in Kolwa, a rural community in the state,  said the rural electrification project was conceived by the bank not only to improve the living standards of rural dwellers, but also to boost economic activities in the areas.

  • BoI boosts youths with skill sets

    Bank of Industry (BoI) in conjunction with the National Board for Technical Education (NBTE) has organsied skills capacity building workshop for youths across the country.

    The contestants, drawn from NBTE-accredited Vocational Enterprise Institutions (VELs) across the country, will be tested in seven key vocational areas such automotive/mechatronics, carpentry/joinery, fashion design, electrical and electronics, painting and tiling, plumbing and fittings and welding and fabrication.

    Speaking during the first leg of the competition in Kaduna, the Acting Managing Director, BoI, Mr. Waheed Olagunju, stated that the programme was initiated as part of the bank’s strategies to provide the needed linkage between the nation’s available skills and market demands.

    The BoI boss stated that the lack of requisite skills was what forced Aliko Dangote to source for over 30,000 wielders from outside the country to work in his cement factories.

    Olagunju added, “This programme will address the challenges of unemployment in Nigeria. Industrial analysts have revealed that we have a lot of youths who have certificates but do not have the requisite skills to be employable. The programme they went for do relate to the real industry or the world. Most employers of labour do not find them employable. They have to seek for such skills outside the shore of Nigeria.

    “If you look at the carpentry and electrical electronic, painting and tiling, plumbing and wielding and fabrication, they all have unique roles to play in the nation’s growth and development. In a country where we have housing deficit of 17million, there is no way we can bridge that gap without quality home-grown manpower.”

  • Why textile factories are still moribund, by BoI

    Why textile factories are still moribund, by BoI

    The Bank of Industry (BoI) has blamed collapse of the textiles companies on failure of state governments to implement the recommendations of the Cotton and Textile Garment (CTG) scheme.

    BoI’s Executive Director,  Small and Medium Enterprises (MEs), Waheed Olagunju who spoke in Kaduna during the regional vocational skills competition organised by the bank in partnership with the National Board for Technical Education (NBTE), said the bank has disbursed 60per cent of the N100billion facility to industries in the sector.

    He also blamed failure to implement the recommendation on how to increase cotton production, address smuggling and lack of lubricants for the woes of the industry.

    He said: “CTG scheme, if you remember was launched around 2010 and it was a N100billion facility. We disbursed about 60per cent of the facility to industries in that sector in Nigeria before it was converted to equity.

    “You will agree with me that funding is only one of the factors of production, there are other things that go with running successful an industrial enterprise, the bank made money available but other recommendations were not implemented.

    “ If other recommendations were implemented along side the funding, it would have led to the revival of that sector. Other challenges that need to be looked into includes smuggling, lubricants and others.”

    He pointed out that if the industries have not done well, it is because the recommendations were not implemented.

    He added: “The real sector of the Nigerian economy is experiencing shortages in terms of the required manpower that they need to operate their industries.

    “This programme is to address two things, there is huge unemployment in the country particularly among the youths. And analysis of the situation shows that most of them are not employable; most of them have certificates but don’t have skills required by the real sector of the economy. So we are trying to ensure that we beef up the quality of the output of our vocational schools.

    “Prior to the oil boom, vocational schools operated very well, they provided manpower for the economy, but, for the last 20-40 years, we have seen a decline in these area. So the BoI as a development financial institution, we should align ourselves, key our strategies into the nation’s development priority and aspirations and so we are helping in that regard of tackling youth unemployment.

    “When it comes to factories and industrial complex, you will realise that a lot of skilled manpower are imported from countries like Phillippine and Indonesia. For example, the factory put up by Dangote Group recently, he told us that he had to import more than 3,000 Indonesian and Philippinos welders who work in that factory. These are jobs that would have been taken up by Nigerians.”

    On the vocational skills competition, Olagunju said: “Five out of the seven vocational skills, are construction related because we need huge manpower to bridge the 17million housing deficit we have in Nigeria. A lot of industries are coming up and a lot of manufacturing concerns and industrial companies are being constructed all over the country, we need a lot of manpower.

    “The remaining two which are not construction related, that is fashion and automotive are equally important because, there is huge demand in these areas too. So, that is why we carefully selected these sectors, because we are high stakeholders in the Nigerian economy, if the economy does well, we will benefit from it.”