FG Begins Process for Full Commercialisation, Recapitalisation of FMBN

By Ndubuisi Francis

The federal government has commenced the process for full commercialisation and recapitalisation of the Federal Mortgage Bank of Nigeria (FMBN) with the inauguration of an eight-member Joint Technical Committee (JTC).

Inaugurating the committee, which comprises four members each from the Bureau of Public Enterprises (BPE) and the FMBN in Abuja, the BPE Director General, Mr. Alex Okoh, said efforts to reposition the bank were dictated by the quest to bridge the country’s huge housing deficit estimated at 22 million as at 2019.

He said the terms of reference for the committee include, among others, to conduct a diagnostic review of the bank’s existing institutional framework, organisational structures and operational modality.

The committee is equally to review and harmonise all existing policies, law and regulations governing mortgage banking in Nigeria in order to identify areas that would facilitate the implementation of full commercialisation and recapitalisation of the FMBN.

It is also to harmonise and synchronise all the reform processes of the FMBN with the ongoing reform of the housing sector,
develop strategies on how to reform the bank to enable it to raise funds from the money and/or capital markets without government guarantees.

The terms of references also mandates the committee to undertake review of the legal, institutional and operational frameworks of mortgage banking in a few African counties and other emerging economies with a view to learning from their key success factors (KSFs) that can be replicated.

He recalled that the Bureau, in pursuance of its mandate for the reform of government-owned enterprises, met with the management team of FMBN on February 18, 2021 where robust discussions on the BPE’s proposed plan for the commercialisation of bank in line with its 2021 work plan and as approved by the National Council on Privatisation (NCP) were discussed.

Okoh stated: “Interestingly, the proposal is in tandem with the ongoing efforts of the FMBN’s management to reposition the bank for optimum performance as articulated in the five-year strategic plan developed by the bank.”

According to him, it was after this that it was resolved that a joint technical committee be constituted to prepare the bank for commercialisation and recapitalisation by reviewing the five-year strategic plan with a view of embedding it within the overall reform plan of the Bureau for FMBN.

Okoh noted that the committee members were chosen in recognition of their wealth of knowledge and expertise in the reform project and expressed the hope that the outcome of their assignment will pave the way for the transformation of FMBN into a viable entity that will assume a pivotal role in the housing sector value chain.

The assignment, he said, is of a critical national importance and charged the members to approach it with the highest sense of responsibility.

Also speaking, the Managing Director of FMBN, Mr. Ahmed Musa Dangiwa, remarked that the inauguration of the Joint Technical Committee had further consolidated the relationship between the BPE and the bank.

While pledging support for the commercialisation and recapitalisation process, Musa expressed optimism that the new initiative would address the housing deficit in the country.

The committee is to conclude its task within 60 days.