Banks’ performance under ACGS 13.9% low in July

The Performance of deposit money banks under the Agricultural Credit Guarantee Scheme (ACGS) show 13.97 percent drop in July as three banks granted a total of 1,754 loans valued N645.03 million compared to 4 banks that granted a total of 2,039 loans valued N667.04m at end of June, 2014.

 The breakdown of the disbursements in July by the banks is as follows: First Bank of Nigeria (FBN) plc {375 loans valued N171.499m}; Keystone Bank {150 loans valued N31.500m} and Union Bank of Nigeria {1,229 loans valued N442.030m).

While 46 MFBs granted a total of 4,898 loans valued N499.39m under the ACGS in July, 2014, 70 MFBs granted a total of 6,212 loans valued N805.085m under the ACGS in June, 2014.

The ACGS was established in 1977 to provide 75 percent guarantee for loans granted to the agricultural sector by banks. The Scheme pays 75 percent of any outstanding default balance to the bank after the security pledged has been realised.

According to the Development Finance Department report released by the Central Bank of Nigeria (CBN) the ACGS was established in 1977 to provide 75 per cent guarantee for loans granted to the agricultural sector by Banks. The Scheme pays 75 percent of any outstanding default balance to the bank after the security pledged has been realised.

The analysis of loans guaranteed by value indicates that Delta State granted the highest with N145.19m followed by Adamawa and Kwara States which granted N140.31m and N131.91m respectively.

The distribution of number of the loans guaranteed by purpose indicated that food crops accounted for 5,291 loans (79 percent), followed by livestock and mixed farming which recorded 578 loans (9 percent) and 456 loans (7 percent) respectively. Fisheries, cash crops and others recorded 151 loans (2 percent), 113 loans (2 percent) and 63 loans (1 percent) respectively.