There was disagreement, on Wednesday, during the Senate Joint Committee on Aviation and Anti- Corruption public hearing over the mismanagement of N500 billion Aviation Intervention Fund.
The disagreement ensued when the former chairman of the defunct Air Nigeria, Mr Jimoh Ibrahim, denied collecting N35.5 billion from the Bank of Industry.
However, the Group General Counsel of the United Bank for Africa, Mr Samuel Adikamkwu, corroborated the position of a former Executive Director of Finance of Air Nigeria, Mr John Nnorom, and insisted that Ibrahim actually applied and obtained the loan through the UBA.
Nnorom, former employee of Jimoh Ibrahim informed the committee that he did due diligence on the loan and secured necessary documentation while in the employment of Air Nigeria before he decided to be servicing the loan with N228 milion monthly for nine months before the airline collapsed.
Nnorom made it known that the moment the N35.5billion intervention fund was paid into the Airline’s account through the UBA, it disappeared into one of the private accounts of the owner without any amount from the fund injected into the Airline “thus paved the way for its eventual collapse.”
He added: “The Aviation Intervention Fund was taken by Air Nigeria. In my capacity as the Executive Director of Finance, to pay the loan, I needed document to pay and I did due diligence and I discovered that Air Nigeria actually took the loan.
“Jimoh Ibrahim said he did not take a loan. He said he acquired Air Nigeria and paid the money 100 per cent and he was given a clean bill by the UBA. But you cannot finance a loan if it is not bad after some time.
“The question is how that loan entered the account of Air Nigeria again. It is the intervention fund that was transfered back to UBA, which the bank is now servicing even after the airline was no longer in existence.”
“ I paid the loan, about N228 million for about nine months.”
Jimoh Ibrahim, however, argued that the BoI did not give him any loan, but that it was the UBA which actually applied and obtained the loan which had nothing to do with Air Nigeria, because the money which was used to resuscitate the defunct airline was sourced from his conglomerate.
According to him, “Government did not give me loan and I did not collect any loan from the Bank of Industry or any other agency of government. What has government to do with me?
“When we bought Air Nigeria, I did not see any intervention fund, no cash was paid to me or credited to Air Nigeria from the fund. When we came in, Air Nigeria has a total of about $250 million with two aircrafts parked at the terminal nobody using it.
“At the group level, we provided a bridging loan facility to make sure the indebtedness issue was resolved. The intervention fund has been in existence before we took over.
“At the stage of buying the transaction with UBA, they told us very clearly that if intervention fund re-occur, they would be able to access it. As far as we were concerned, we provided the bridge loan facility. If the UBA access intervention fund, that’s their own.
“The Air Nigeria did not apply to Central Bank directly to collect intervention fund. The debt in existence before we bought the airline was what intervention fund was used for.
We had presented documents before the Senate last year that we had no business whatsoever with the intervention fund.”
However, Mr Samuel Adikamkwu, the UBA representative, presented all the documents related to the matter before the committee to show that the loan was actually requested for by Air Nigeria and that the bank applied for N41.1 billion, being the indebtedness of the airline, but that N35.5 billion was approved.
He added: “In 2010, Air Nigeria made an application to us, to apply for N41.1billion from BoI, because that was what they were owing us, but in the end, we ended up getting N35.5 billion which we used in refinancing part of what was outstanding at that time.
“No fresh cash went to the company but it was to reduce their liability and now extended the period of repayment and also reduce the interest, to free them from enough working capital.
“No one can buy a company with assets and liabilities and now claim that he had paid the loan. The letter was issued for a purpose to enable him assess loans from local and external sources. The Air Nigeria remained indebted to the UBA. There was no time when Air Nigeria was not indebted to the UBA.”
The chairman of the Senate Committee, Senator Hope Uzodinma, queried the management of the UBA for writing a letter, granting a bill clean of health to Air Nigeria, when, indeed, the airline was still indebted to it.
He said: “By July 9, 2010, UBA wrote a letter to NICON Group of Companies that Air Nigeria was no longer owing, and by September 16, 2010, the same Air Nigeria is applying to BoI to finance a loan. Which loan again?”