The Enugu State House of Assembly on Monday approved the N170 billion loan requested by Governor Peter Mbah of Enugu State to execute some projects in the state.
Mr Mbah’s loan request was revealed in a letter read by the assembly speaker, Uche Ugwu, during an emergency plenary in Enugu.
The speaker said the loans from the Fidelity and the Globus banks would enable the state government to execute infrastructural projects.
Mr Ugwu gave a breakdown of the loan as N100 billion Bank Guarantee Line (BGL), N10 billion Term Loan (TL), N10 billion overdraft facility from the Fidelity Bank and N50 billion credit facility from the Globus Bank.
He hinted that the BGL would serve as a guarantee payment for contracts issued to the contractors, China Civil Engineering Construction Company (CCECC) and others for the execution of projects to be undertaken by the state government.
On the term loan, the speaker revealed that the loan had an interest rate of 22 per cent per annum, which is subject to review in line with money market realities, adding that the repayment tenure is 48 months.
Mr Ugwu pointed out that the overdraft facility loan would ensure prompt payment of workers’ salaries and sorting out other recurrent expenditures and had a repayment tenure of 12 months.
The speaker said the State Executive Council approved the loans on October 6.
Contributing, the house minority leader, Iloabuchi Aniagu, commended the state governor for forwarding the loan request, which he said was timely.
According to Mr Aniagu, the loans will enable the state government to undertake a developmental agenda for the good people of the state.