We gave N35bn aviation loan to Jimoh Ibrahim, UBA insists

United Bank of Africa (UBA) has insisted that it gave Jimoh Ibrahim, group managing director, Global Fleet, N35 billion loan in 2011, to fix his airline, Air Nigeria.

The money is part of the Federal Government’s N120 billion, which is now being investigated by the Joint Senate Committee on Aviation and Anti-Corruption, and part of the N500 billion intervention fund for Small and Medium Scale Enterprises as well as the power and airlines sectors.

Jimoh Ibrahim has denied he did not collect such loan from the bank.

At the opening day of the investigative hearing on the disbursement and utilisation of that fund released by the Federal Government in 2011, it was revealed that out of the N120 given to 10 airlines in 2011 as intervention fund, the defunct Air Nigeria collected N35.5 billion as loan from the fund.

Speaking yesterday at resumed hearing on the matter, Samuel Adikamkwu, group general counsel, UBA, showed a letter from Global Fleet to the bank, asking it to apply for the loan from the Bank of Industry (BoI) on its behalf.

The letter, dated July 9, 2010, and other correspondences between the two companies were presented by Adikamkwu as evidences to the Joint Senate Committee chaired by Hope Uzodinma.

According to Adikamkwu, “Jimoh Ibrahim kept on saying that he was not part of the intervention from Air Nigeria. He knows that Virgin/Air Nigeria owed UBA. I showed a letter from his company asking us to apply for this intervention fund. And when that money came, he was given a different offer letter elongating his payment period to 15 years. And also reducing the rate of interest.
“That freed his working capital, giving him enough room to operate than if he were paying under the old terms. I know it’s a harsh environment but he cannot tell me that the airline did not benefit. The airline died because he had problem with the regulator.”

He said the loan was used to service the $250 million debt owed by Air Nigeria, while the tenor was extended to 15 years with reduced interest rate.

But Ibrahim insisted that his company did not benefit from the intervention fund, adding that he merely borrowed N35.5 billion from UBA Capital and not BoI.

While admitting that the airline folded up two months after he obtained the loan from the commercial bank, he pointed out that he sold the airline back to the bank.

“If I didn’t benefit, I will not tell you that I benefited,” he told the Committee.

When asked by the committee chairman to tender documents like change of ownership, letter of consent from majority shareholders, among others, he refused to do so, stressing that as a private company he is not under obligation to present documents to the panel.

Air Nigeria, he explained, had a total debt of $250 million, which he inherited, adding that UBA gave him clean bill of health to collect the loan.