First City Monumental Bank, FCMB, has increased its loan facility to agricultural sector to six per cent totalling N40 billion out of its N600 billion loan facility as at year 2014 from the initial two per cent, just as it promised to increase the portfolio in the years ahead.

According to the bank, this initiative which started about three years ago, is in with Federal Government’s Agricultural Transformation Agenda and diversification of Nigerian economy’s drive which is more achievable in agricultural sector.

Giving this assurance at a media chat organised by the Bank and tagged, ‘’FCMB Agric Business: Diversifying the Nigerian Economy’’ , its Group Managing Director/Chief Executive, Mr. Ladi Balogun, assured that FCMB will not only intensify its support to the agricultural sector and its value chains in order to fast-track the growth of the Nigerian economy but become the bank with the highest credit in the agricultural sector in the next few years

He said: “Now more than ever with what is happening in our economy the importance of diversification of the economy is absolutely critical. For many years, we have been talking about the importance of agriculture to our economy. It accounts for over 30 per cent of the Gross Domestic Products, GDP. It was previously 40 per cent before the rebasing of our GDP and I believe it employs about 70 million Nigerians to the best of my knowledge.

“Therefore, the transformation of this economy and the growth of this economy without focusing on agriculture are impossible and the opportunities there are very significant.

“What is interesting to know is the bank like the FCMB that has the word ‘City’ in its name is now becoming very rural and the bank that has its origin in investment banking is now taking retail banking and even things like micro finance very seriously because banks need to begin to look at inclusive rather than growth.

“Our loan is now about N600bn, which tells you that we now have over N40bn of our exposure to agriculture. We involve not only the large corporate customers, but we are down to the micro end with smaller farmers”, Balogun said.

According to him, the bank is focused on being a strategic partner to the government and other stakeholders in the agricultural sector to ensure food sufficiency, employment and revenue generation, in line with its value as a helpful financial institution.

Highlighting FCMB’s contributions to agriculture, he informed that in 2014 the bank provided lines of credit valued at almost N30 billion to the sector, adding that six per cent of FCMB’s total loan book or 200,000 loans per year go to the agriculture sector, compared to an average of three percent in the banking industry.

“We realise that there are millions of farmers across the country that need credit at affordable rates, considering the level of attraction the agric sector has garnered. That is why we are increasing our level of support,” he explained.

He continued, “Among other supports to farmers, FCMB in 2014 provided funding worth N120 million to the Tractor Owners & Hiring Facilities Association of Nigeria, TOHFAN, for the acquisition of tractors, which have been distributed to farmers in Kaduna state. It has also collaborated with Doreo Partners to launch a support programme for farmers, known as Baban Gona (or ‘’great farm’’).

“This is an agricultural franchise model, where farmers are trained and offered loans to carry out their farming activities. The programme is still running and its impact is being felt across the country. A major component of FCMB’s sustainability principle is on agriculture and empowering farmers with a view to reducing the level of poverty among them.”

On the focus of the bank in 2015 and beyond, Balogun assured that the bank would increase the level of its funding and other forms of support to the agric sector and agro-businesses, including SMEs. He added that it would also access the N20 billion CACS and Micro, Small and Medium Scale Enterprises, MSME, intervention funds to provide term loan and working capital finance in support of viable agribusiness projects.

The Managing Director, Dorel Partner, Mr. Kola Marshal, confirmed that his company was able to raise some farmers out of poverty in 2014, with support from FCMB.

“With our partnership, we were able to unlock the capitals to these farmers to enable them to invest appropriately in their farms. We are doing this because Nigeria today has massive unemployment challenges of about 60 per cent with the median age of 19.

We have about 18 million youths in Nigeria under the age of 19. We see agriculture as Nigeria’s job engines and our approach is to invest in businesses that lead to increase in productivity, small scale farmers and create jobs for the people. Make them successful and small scale farmers. Our target is to reach one million farmers by 2025,´he said.

However, the Chairman, Tractor Owners and Hiring Facilities Association of Nigeria, TOHFAN, Alhaji Danladi Garba, commended the FCMB for its continued support to his group, adding that the bank’s continued collaboration is already helping to bridge the equipment and machinery gaps in the agricultural sector.

Garba, who disclosed a shortage of about 73,000 tractors in the sector, said, the association had applied for credit facilities to FCMB for 100 tractors and was looking at between now and March to secure the loan after which it can distribute the tractors so that they can at least start their operations by April.

and whats their interest rate?