PRODUCTS AND SERVICES OFBANK OF INDUSTRY (BOI) Shea Conference 2013 1
Background•BOI was established in October, 2001 following the reconstructionof the Nigerian Industrial Development Bank (NIDB) by subsumingthe mandates of NBCI and NERFUND. NIDB had been in existencesince 1964 as one of the oldest DFIs in Nigeria, and Africa.•In pursuance of its vision to become a world class and self-sustaining National Development Finance Institution, a consultancyfirm was commissioned in 2004 to undertake an Institutional andManagement Study of the bank, which resulted in the restructuringof its erstwhile Management to its present status to allow forefficiency in driving the Bank’s business.•BOI is largely a state owned DFI charged with the responsibility ofpromoting the emergence of a virile industrial sector. In other words,BOI was conceived to catalyze the transformation of the real sector.Its mandate is to provide financing and business support services toentrepreneurs especially SMEs with strong potentials foremployment generation and exports. The Bank is to act as a driver inthe development of SME sector in Nigeria on a sustainable basis.2
BOI’s Ownership•Shareholders»99.9% of Equity held by the Federal Government through: Ministry of Finance Incorporated (MOFI) 59.54% Central Bank of Nigeria (CBN) 40.36% Equity held by 42 private Shareholders 0.10% ------------- 100.00% ======== 3
•At BOI, there is clear delineation of separate and distinct roles forthe owners, the Board and the Management, as well as clarificationof the powers of the Board, those delegated to Management and theresults and accountability it expects from the Management. BOIfully complied with the requirements of the Companies and AlliedMatters Act (CAMA) in its operations and reporting through; -maintenance of proper accounting records, -applicable accounting standards are followed, -suitable accounting policies are adopted and consistently applied•Internal control procedures are instituted as far as is reasonablypossible, safeguard assets and prevent and detect fraud or otherirregularities 4
BOI’s VISIONTo be a leading self-sustainingDevelopment Finance Institution,operating under sound management andbanking principles, that would promote theemergence and development of a virilecompetitive industrial sector in Nigeria. 5
BOI’s MISSION•To transform Nigeria’s industrial sector and integrate itinto the global economy by providing financial andbusiness support services to existing and new industries toattain modern capabilities to produce goods that arecompetitive in both domestic and external markets.BOI Core Activities•Project Identification and Selection• Resource Mobilization• Financing (Long Term, Short Term and Equity)• Industrial Policy Formulation• Business Development Support 6
BOI Products and Services•Primarily, BOI aims to support business through the provision ofthe following support programs:•Providing financing for the support of entrepreneurs through theprovision of direct loans, guarantee support etc•Providing financial advisory services to entrepreneurs•Acting as intermediates between entrepreneurs and both local andinternational financial institutions assisting businesses accessfinancing from these institutions.•Collaboration with other development institutions particularlynational, public and private sector multilateral and bilateralagencies.•A host of other complimentary services rendered by BOI’s 7subsidiaries.
BOI Specific Services are;• Equity Financing• Co-Financing/Syndication•Infrastructure Development/Industrial Parks•Structured Lending•International Operations/Trade Services• Management of specialised Funds•Other complimentary services rendered by BOI’s subsidiaries: Leasing, Trustees, Insurance, Consultancy, 8 Micro Finance Bank and Bureau De Change.
OTHER ROLES OF BOI• Establishment of global partnership in support of theindustrialization of Nigeria in conjunction with otherdevelopment partners.• BOI has working relationship with the following; - DBJ,JBIC, JICA, JASME amongst others.• Also have MOUs/Working Relationships with the WorldBank Group, African Development Bank Group, IDB,IDC, TICAD/UNDP, UNIDO, etc.• Structuring of schemes of financial partnership (M&A,JVs, PPP, portfolio investment, ventures capital, leasing,etc) between Nigerian and foreign companies. 9
• In its bid to further cascade its operations to Micro,Small and Medium Enterprises (MSMEs), BOI recentlyestablished a Micro Finance Bank and also introducedlending to cooperatives. The cooperatives comprises,mainly, those that attended the Entrepreneurialdevelopment workshops (Boot Camps) which the bankhas been organizing in conjunction with the CommerceDepartment of the United State of America in somestates of the federation. The Industrial/EntrepreneurialDevelopment Program has continued to receive theBank’s attention. The Bank similarly encourages stategovernments to establish MSME funding schemesunder which BOI and state governments contribute inequal proportion solely for the industrial developmentof their respective states. 10
• In order to reduce the operating expenses of MSMEs, decrease thehardships posed by infrastructural challenges and thereby enhance theirviability as well as competitiveness, BOI is encouraging stategovernments to build industrial parks in collaboration with theircommercial banker and development partners. Under the scheme,MSMEs are to be allotted rented spaces in clusters in the industrial parksthat would be provided with some infrastructural facilities as roads,electricity, water, telecommunications services and security.• Towards attaining the Millennium Development Goals (MDG) ,the bankalso organized workshop on Women Entrepreneurship Development andAccess to Finance in collaboration with Women Affairs Ministry andHouse of Representatives Committee on Women Affairs and as well firstLadies of some States. The bank also have a Gender Desk handlingvarious loan schemes exclusively for women enterprises in conjunctionwith the Federal Ministry of Women Affairs amongst others. 11
MATCHING FUND • The essence of the fund is to empower entrepreneurs in the state. BOI will match whatever amount the State Government is willing to put down. The key areas for which the fund will be utilized include the following: – Cooperative Funding: The fund will be used to finance mostly cooperatives utilizing local resources in each local government area. The collateral security that will be required under the scheme is relaxed. Participants will just be required to contribute 10% of the borrowed fund as collateral deposit. 12
– SME Financing: This will involve provision of plant and machinery, retooling etc of SMEs.– Rehabilitation and resuscitation of industries.– Finance of clusters and industrial parks.– Special Projects. 13
CONCLUSION Based on the foregoing, BOI will be delighted to partner with genuine entrepreneurs to foster economic growth and assist in alleviating poverty in the country. 14