The Central Bank of Nigeria (CBN) has extended its regulatory approval to the Development Bank of Nigeria (DBN) to enable the development finance institution (DFI) put in place a risk-sharing module that would define its transactions with partner financial institutions.
DBN’s Managing Director/CEO, Mr. Anthony Okpanachi, who disclosed this in an interview in Abuja, weekend, said that the Bank’s management is already synergising with the World Bank for consultants to put the structures in place.
According to him, although the wholesale development bank is yet to implement its risk-sharing model, the CBN had already given the regulatory approval.
It is also now confirmed that with the new equity shareholders—the African Development Bank (AfDB) and the European Investment Bank (EIB), which recently invested $50 million and $20 million respectively, the DBN is now owned by the Federal Government, Nigerian Sovereign Investment Authority (NSIA) and EIB.
Okpanachi stated that AfDB and EIB had effectively funded the investment, adding that the Securities and Exchange Commission (SEC) had approved the basis of allotment of shares.
“As we speak, effectively they have funded the investment in the Development Bank of Nigeria. So, they are now shareholders in the Development Bank of Nigeria. The $50 million from African Development and $20 million European Investment Bank are already in the system. Now, the Bank is owned by the Federal Government, NSIA, African Development Bank and European Investment Bank.”
Giving further insight into the risk-sharing module, Okpanachi disclosed that a risk-sharing arm would be established as a subsidiary of DBN, stressing that the Bank’s management is already working with the World Bank for consultants to put the structures in place.
He said: “We have not started that, though we have gotten the regulatory approval to set it up. It’s going to be a subsidiary of the Development Bank of Nigeria and we have started working with the World Bank to get the consultants to put the structure in place. It is our projection that towards the end of the year or early next year, the credit guaranty should come on board.”