NIMASA, BoI partner on single-digit vessel financing

  • Bank to guarantee agency’s funds, manage portfolios

A container vessel…indigenous ship owners will be able to acquire such expensive asset if funds are available at an interest rate that enables competition with foreign counterparts

Nigerian operators will be able to access single-digit credit facility for maritime assets acquisition “in no distant time,” to enable them compete favourably with foreign counterparts, the Director-General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Dr. Dakuku Peterside, has said.

This disclosure followed a meeting in Lagos between NIMASA and the Bank of Industry (BOI), during which both parties agreed, among others, to work out modalities on financing the acquisition of vessels at a single digit interest rate, BOI’s guarantee for the funds that NIMASA will entrust to it, and its management of the portfolio to guarantee effectiveness.

The development, when realised, will guarantee the indigenous players an enabling competitive environment in the global maritime arena, as they have been unable to access the Cabotage Vessel Finance Fund (CVFF) over the years due to stringent measures.

Positive of an early result, Peterside said: “We have continuously sought partnerships that would grow our industry. We know that maritime asset financing is a major challenge of this industry and we are tackling it head on. In no distant future, our people would be able to reap the benefits of our strategy.”

On his part, the Managing Director of the Bank of Industry (BOI), Olukayode Pitan, commended the NIMASA for its transformative initiatives in the sector, which he said have renewed confidence in the industry, adding that BOI was ready to partner the agency because the sector’s viability would rub off on the entire economy.

He disclosed that BOI has an existing financing model in partnership with the Nigerian Content Development and Monitoring Board (NCDMB), which could also benefit the maritime sector if applied. He added: “We are proposing a partnership with NIMASA on vessel financing.

“We already have a similar partnership with NCDMB that is currently running at a single digit of 8 per cent, with little or zero risk for NCDMB, since the fund invested by NCDMB is guaranteed by BOI. This model, we think, can also benefit NIMASA and the entire maritime sector.”

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