Banks submit $350m modalities for CVFF disbursement, await FMOT approval

THE Ship Owners Association of Nigeria (SOAN) has said that banks have submitted modalities for the disbursement of the Cabotage Vessel Financing Fund (CVFF) with the Nigerian Maritime Administration and Safety Agency (NIMASA), but said details of the modalities remain undisclosed because NIMASA has forwarded same to the Federal Ministry of Transportation (FMOT) for necessary approval.

Disclosing this to the Nigerian Tribune exclusively, President of SOAN, Dr MKGeorge Onyung, explained that since it’s the FMOT that is handling the CVFF disbursement, NIMASA had to forward the modalities released by the commercial banks to the Ministry.

According to the SOAN President, “At the birthday celebration of the NIMASA Director-General, Dr Bashir Jamoh, recently in Lagos, he told us (shipowners) that the banks have released the modalities for the disbursement of the CVFF.

“He however said that NIMASA had to forward the modalities to the FMOT because the whole arrangement is under the ministry. So, as things stand, we are all waiting for the FMOT to come out public on the modalities that the banks have released. We are all in a waiting game for now.”

Recall that NIMASA had issued a 72 hours ultimatum to the five Primary Lending Institutions (PLI’s) handling the disbursement of the CVFF to release modalities for the disbursement of the fund.

Briefing journalists recently after a meeting with the commercial banks, the DG of NIMASA, Dr Bashir Jamoh stated that the modalities to be released by the five banks include the interest rate, tenure, collateral and requirements needed to access the fund.

According to Dr Jamoh, the interest rate must be of international best practices because the money to be released to the banks are in foreign currencies and not local currency.

He, however, stated further that the disbursement of the CVFF can’t start without stakeholders engagement, saying that was why the agency met with the PLIs.

He said, “We can’t start disbursement without stakeholders engagement, therefore, stakeholders engagement starts today. We are on track. We have started with the PLIs and all the five of them are here today. We have listened to them and they listened to us and from all indications, they are ready for us as well.

“What we want them to do now is to come up with collective decision and that cannot take more than 72 hours.

“As we are leaving this boardroom, they will sit down and decide on the interest rate to be used because we don’t want them to come individually to us with different interest rate, we want them to have a consensus and a standard template on the disbursement of funds as well as the interest rate. This is what we advised them to do and as soon as they finish that, we will then invite the shipowners,” he said.