BPE explains why BoA must be restructured

By Joseph Inokotong, Abuja

Director General, Bureau of Public Enterprises (BPE), Mr. Alex A. Okoh has said that it has become imperative to restructure the Bank of Agriculture (BoA) to substantially improve its operating framework and governance structure with a view to enhancing its efficiency, 

Speaking at the kick-off meeting for the recapitalization of the bank on Thursday, in Abuja, Okoh said the bank had performed sub-optimally due to the myriad of challenges it faced since inception in 1972. 

According to him, the process will lead to the privatization of equity of the bank and it’s envisaged that the Central Bank equity will be reduced to 20 per cent while the Federal Ministry of Finance (incorporated) will be reduced to 20 per cent.

“The government agencies equity in the new bank will be a minority of 40 per cent. We will then invite private sector investors who will own 20 per cent and the remaining 40 per cent equity will be owned by farmers and farmers’ cooperatives,” he added. 

Okoh stated that the new strategy envisages that BoA will be transformed into a truly agriculture finance bank modeled along the lines of Agriculture Bank of China and Rabobank of the Netherlands, adding that upon its establishment in 1972 to serve as an agricultural and cooperative bank to provide services of a development finance institution, it was vested with the responsibility of providing low cost credit to small holder and commercial farmers. 

In a statement Thursday in Abuja,  the Head, Public Communications Amina  Tukur Othman, however, lamented that the bank had been unable to realize its responsibilities due to its current structure, stressing that the proposed restructuring and recapitalization of the bank will transform into an agricultural finance bank with functional branches in all the local government areas and major towns in Nigeria.

The director general said that the model was sure to encourage farmers to form clusters of cooperatives and thrift societies throughout the six geo-political zones for the purpose of participating in the ownership of the bank.

Okoh added that the model would fundamentally ensure that the BoA becomes a farmers’ bank owned by farmers.