Akwa Ibom Debt profile: Controversy over UBA bank loan

* Akan Okon, Aniekan Umanah speak
* The House of Assembly will do the needful, says AKHA Chairman on Finance & Appropriation

Akan Okon

BY EMMANUEL AKPAN

There appears to be an interesting dimension in the recent request by the state Governor, Mr. Udom Emmanuel towards converting Akwa Ibom State loans into Federal Government bond. THE INK reporter gathered that the request does not cover the loans gotten from other banks as the United Bank for Africa, UBA is the only commercial Bank that this over sixty four billion naira is being owed. Our reporter understands that the state is indebted to UBA with an outrageous sum of money. It was revealed to our reporter by a senior member of Staff of UBA in Uyo that as at June 30th, the loan amount stood at 64,556,632,439.08 with an international rate at 15% running in tenure of about five years.

Financial Experts are however worried that the State Government have not disclosed the loan gotten from other Banks and how they intend to go about repaying them. It was not very clear if the state Government owes any other commercial Bank in the country as information from Government House in this regards was silent.
What has however raised many eye brows in the state is the conspicuous and deliberate silence of the State Government on whether Akwa Ibom owes any other bank and how they intend to repay the loan if they have been loaned some money.
A former commissioner for Finance in the state has described the decision of the state Government to keep her citizens in limbo in the debt profile as insensitive. He described as callous and unnecessary the hoarding of such information from the citizenry noting that it breeds suspicions between the leaders of the state and her followers. He therefore called on the Government to please adhere to the rules of the game and carry her citizens along in the scheme of things.
The former commissioner who refused his name in print called on the House of Assembly to write to all the banks requesting to see the loan the state collected from them. This way he noted will allow for checks and balances. He opined that if it is only the loan from UBA that the Akwa Ibom State Government wants to bond with the Federal Government that the state may be taken for a ride when the Governor will sooner or later request for another bonding from other commercial Banks.
He however commended the House of Assembly for what he called pragmatic and thorough investigation of the matter. And urged them to do all things within their ability to ensure that they do not fail the people of Akwa Ibom State as the loan bonding is already raising tension in the state and throwing to test the character of our leaders.
But the Chairman Akwa Ibom State House of Assembly Committee on Finance and Appropriation, Dr. Usoro Akpanusoh has appealed to the citizens of the state to remain calm and law abiding noting that the committee has since swung into action and will follow the due process to achieve whatever purpose it has to achieve to the benefit of Akwa Ibom People.
Akpanusoh spoke to the Press yesterday after the committee meeting. He said ever since the Speaker of the House Aniekan Uko minuted the letter from the Governor to his committee that they have been meeting with a view to taking a definite stand and resolution on the matter. The Esit Eket/Ibeno representative hinted that the House will not fail the people. He restated the commitment of the House to due process and the rule of law.
Speaking further Akpanusoh who is a graduate of political Science maintained that if it is in the interest of the Akwa Ibom Economy to give a legislative backing to the Governor’s letter that the House will oblige but if it is not, that the House will stay on the side of the rule of law. He advised the people of the state to avoid speculations and not heat up the polity with imaginations and imaginary stories.
On how far the committee has gone in terms of investigations into the content of the letter and the loan controversy, Akpanusoh said there is no controversy about the Governor’s letter and explained further that the Finance and Appropriation Committee have done so much in few days.
He said, the committee had summoned the Finance Commissioner Mr. Akan Okon to brief and explain to members the implications of the Governor’s request and the implications for the Akwa Ibom Economy. He maintained further that the Finance Commissioner had honoured their summons and appeared before the committee Friday last Week.
The lawmaker stated further that the committee had also summoned the regional Manager of UBA, Mr. Magnus to appear before it and explained the contents of the debt and loan owed its bank by the state. He said, while Mr. Magnus acknowledged receipt of the summons, that the UBA man explained that he couldn’t appear before the House yesterday as he was already engaged in another official assignment in Abuja but promised to make himself available to the committee when he returns.
Dr. Usoro Akpanusoh said he is optimistic that the UBA Magnus will honour their summons so that he could answer questions pertaining to the loans and other questions lawmakers will like to ask him. The lawmaker emphasized that the committee will be thorough in its assignment and that every area will be addressed. He maintained that at the appropriate time the committee will make its resolution public for consumption and appealed to the people to allow the committee time to put final touches to the assignment ahead of them.
On his own part, the commissioner for Finance Mr. Akan Okon while briefing newsmen in his office yesterday acknowledged appearing before members of the Akwa Ibom State House of Assembly committee on Finance and Appropriation last Friday. He explained that the essence of the meeting was to inform members on the request from the state Governor and why it is good for the Akwa Ibom Economy.
He said the debt profile of the State in terms of the loan is N64.5b and that the State is remitting N3.5m monthly to the bank.
Mr. Okon who was accompanied by Aniekan Umanah his Information commissioner Counterpart said, the move by Governor Udom Emmanuel to restructure Commercial Bank Loans of the State to Federal Government Bonds was as a result of an opportunity and window provided by the Federal Government to restructure States Commercial Bank Loans in the country, especially now that the oil prices is going down. The commissioner said the window will enable affected States the breathing space, adding that as the oil price is going down, revenues that is going to each of the States across the country is also going down. 
Akan Okon noted that if the Akwa Ibom State Government continues the same way, (getting loans from commercial banks) the State will not have money to carry out other activities; instead the State will be concentrating on funding services alone like paying of salaries without embarking on other capital projects.
He added that the State Government will key into Federal Government open window for restructuring of commercial bank loans into Federal Government Bonds, and that if the State succeeds, interest rates will be very cheaper than commercial bank loans.
According to the Finance boss, “For Akwa Ibom State, we have applied to the Debt Management Office and alongside with 11 States in the country which they have gotten approval. One of the requirements is that the State needs to get House of Assembly approval and that is why we have applied to the House of Assembly to restructure our commercial bank loans which is #64. 5 billion to the Federal Government bonds.”
Okon said the advantage of restructuring the loans to Federal Government bonds is that the State will pay a low interest rate than the commercial bank, and the State at the same time will have money to embark on other capital projects as well as programmes for its citizens. He said another advantage is that the Federal Government has eliminated the issue of paying contractors as was before, adding that States will only pay directly to the Debt Management Office.
While urging the people of the State not to misinterpret the move my Governor Udom Emmanuel, the commissioner stressed that it was necessary to address the press in order to put the facts and records straight to the general public. He described the window provided by the Federal Government as a great step taken to salvage some States from high profile debts.
He also used the opportunity to debunk rumours that the State has closed all Internal Revenues Accounts, saying that the intention of the State Government is to operate a single Internally Generated Revenue Account with the Banks involved even as he said it will help government to hold banks involve to be accountable.