President Muhammadu Buhari has approved a N656 billion Bridge Financing Facility to 36 states.
The Minister of Finance, Budget and National Planning, Zainab Ahmed, disclosed this on Thursday at a virtual NEC meeting presided over by Vice President Yemi Osinbajo and anchored from the Presidential Villa, Abuja.
Ahmed said each state will receive N18.2 billion, adding that the bridge facility is processed by the Central Bank of Nigeria (CBN).
She said; “the approved bridge facility of N656.112 billion will be disbursed in six tranches over a period of six months to the states. Expectedly, each of the 36 States will have a total loan amount of N18.225 billion, with a 30-year tenor and a two-year moratorium at an interest rate of nine per cent,” Ms Ahmed revealed. “The facility is to help the states afford the repayment of previous bailout facilities guaranteed for them by the federal government.”
The minister explained that the support was to help state governments to meet their financial obligations, especially the previous budget support facility due for repayment.
On July 15, the council had received updates on the budget support facility to states. At the meeting, Ms Ahmed informed NEC that the deductions for repayment of previous bailout facilities would commence soon. Subsequently, the states sought further support leading to the idea of bridge financing.