NIGERIA Invest in 2012-13 - Newsdesk Media

Achievements and activities of NEXIM Bank,
geared to the current transformation agenda
Mr Roberts U Orya
Managing Director/Chief Executive Officer
NEXIM Bank
Introduction
The Nigerian Export-Import Bank
(NEXIM) was established by Act 38 of 1991
as an Export Credit Agency (ECA) to diversify
the external sector of the Nigerian economy.
It currently has authorised and called-up share
capital of naira (N)50 billion ($306 million),
held equally by the Federal Ministry of
Finance, represented by the Ministry of Finance
Incorporated (MOFI), and the Central Bank
of Nigeria (CBN).
Functions
• Provision of export credit guarantee and
export credit insurance facilities to its clients;
• Provision of credit in local and foreign
currencies to its clients in support of exports;
• Establishment and management of funds
connected with exports;
• Maintenance of a foreign exchange
revolving fund for lending to exporters who
need to import foreign inputs to facilitate
export production;
• Maintenance of a trade and market
information system in support of
export businesses.
Activities/initiatives undertaken
Sourcing / Facilitating Investment Capital
• US$20 million commercial line of
credit from EXIM India
The bank secured a US$20 million
commercial line of credit from the Export
Import Bank of India (EXIM India),
following the signing of an agreement
with EXIM, India in November 2011. The
US$20 million line from EXIM India is an
enhancement of a US$5 million LOC, which
was granted to NEXIM in 2007.
• Collaboration with the Export-Import
Bank of the United States
The bank continued its collaborative
arrangement with the Export-Import Bank
of the United States, through which lines of
credit will be made available to Nigerian
The bank’s achievements under the current
managing director include:
Corporate Transformation
In 2010, the Bank commenced a transformation
programme with a five-year strategic plan,
which has the following strategic objectives:
• Having a clear market focus and becoming
a major contributor to non-oil exports;
• Building a world-class institution that
absorbs best-in-class corporate governance
and risk management practices;
• Becoming a relevant player in the export
market and significantly influencing
government trade policies;
• Building a profitable institution with
robust balance-sheet size;
• Building a highly skilled and
motivated workforce.
One of the major highlights of the corporate
transformation is the redefinition of the
target sectors to be promoted by NEXIM
to include the high-growth sectors, namely
manufacturing, agriculture, solid minerals and
services, all of which come under our MASS
Agenda. We have also redefined our target
markets, with a greater emphasis now placed
on encouraging and developing exports to the
regional market of ECOWAS, while not losing
sight of other markets in the rest of Africa,
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exporters wishing to import inputs from the
United States. The US EXIM line, when
made available, would be non-funded
and transaction specific, which will help
to boost the bank’s activities under the
Foreign Input Facility.
US$50 million Afrexim Line of Credit
The bank continued to manage the US$50
million AFREXIM commercial line of
credit, which was availed by leveraging on
the bank’s balance sheet to provide funding
support to three projects in the cumulative
sum of US$38 million, with US$ 16million
currently outstanding as contingent liability
to the bank as at year end 2010.
US$200 million African Development Bank
(ADB) Sovereign Guaranteed Loan
The bank concluded arrangements /
negotiations with the ADB towards securing
Asia and other developed regions. The current
market focus is aimed at deepening trade in
the ECOWAS region in line with the ECOWAS
protocols. Other aspects of the transformation
were the establishment of new corporate
governance and risk-management structures,
as well as the Rebranding and Information
Technology Upgrade.
The bank recorded an increase in
operating profit, which rose by 217 per cent
to N599.63 million ($3.7 million) from the
N189.39 million ($1.2 million) that was realised
in the period ended 31 December 2010. The
total funding support to the non-oil export
sector under the bank’s various facilities
during the period amounted to N8.54 billion
($52.3 million), comprising of N6.26 billion
($38.4 million) and US$15.03 million. This
represented an increase of N1.66 billion
($10.2 million) or 19.44 per cent compared
with the equivalent period in 2010. The
bank’s intervention covered various sectors,
which include manufacturing (61 per cent),
agriculture (14 per cent), solid minerals
(14 per cent) and services (11 per cent).
The developmental impact of NEXIM’s
intervention through loans disbursed during the
year was expected to create/sustain over 5,575
direct jobs and generate/sustain foreign exchange
earnings of about US$178.60 million annually.
a US$200 million Sovereign Guarantee
Loan, with US$50 million to be disbursed
as first tranche. The loan is expected to
facilitate funding intervention to SMEs
in sectors of the economy including the
creative arts / entertainment industry.
Intervention in the Entertainment Industry
The Nigerian entertainment and creative
industry has high growth potentials in terms of
job creation and foreign-exchange generation
opportunities, and falls under the bank’s mandate
of promoting the export of services. In this
regard, in line with the company’s strategic
focus and Mr President’s policy initiatives
towards the creative arts and entertainment
industry, NEXIM played a leading role in
facilitating structured funding intervention
and capacity-building to the industry in 2011.