The Managing Director, Federal Mortgage Bank of Nigeria (FMBN) Mr Gimba Kumo on Tuesday, January 26 said that the Central Bank of Nigeria (CBN) has done nothing to ensure banks paid their contributions to the National Housing Scheme.
He said this while briefing the Senate Committee on Banking and other Financial Institutions in the National Assembly, Abuja.
He complained that commercial banks and insurance companies have defaulted payment of its contribution to housing scheme for 24 years.
Kumo added that since 1992, these financial institutions ignored the Act which compelled them to contribute.
“Section 5 of the NHF Act, provides that commercial banks are supposed to invest 10 per cent of their portfolio to the fund.
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“Insurance companies on their part are supposed to invest 20 per cent of their life insurance funds and 25 per cent of their non-life funds into the fund.
“Section 11 provides that where the bank refuse to pay, the CBN is supposed to force the banks to contribute to the fund at an interest rate of four per cent.
“This has not been complied with since 1992, we have been following up with the CBN but nothing has been done so this is an area that we need you support to ensure that the law is enforced,” he said.
He said that the FMBN was in dire need of the contributions to meet the over 16 million deficit in the housing sector and urged the Senate to assist the bank.
He also called on the Senate to also look into the huge money in the pension funds which can also be used to fund housing in Nigeria.
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However, he called for the recapitalization of the Bank from the current N5 billion capital base to N250 billion to further empower the bank to meet the housing challenge in Nigeria.
“Even the N5 billion it is only the Federal Government that has paid its own share of 50 per cent, CBN that has 30 per cent is yet to pay, the Nigerian Social insurance Trust Fund which has the remaining 20 per cent is yet to pay,” he said.
He added that Babatunde Raji Fashola, the minister of Power, Works and Housing has called for immediate patyment of the CBN and the NSITF.
He also added that the bank are about to complete 67,000 housing units and was currently targeting 72,000 new houses to be spread across the country through the help of the National housing scheme
Kumo said that the houses will spread across FCT, Lagos, Kano, Port Harcourt and the six geo political zones with the major cities getting the largest.
The committee began its 3-days meeting with stakeholders in the banking and financial sector on Monday, February 1.
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