The members of the Adamawa House of Assembly on Wednesday approved a letter forwarded to them by the state governor, Mohammed Bindow, seeking approval to borrow N8.7 billion for infrastructural development.
Earlier, the state governor had requested the House of Assembly to allow him secure the credit facility to enable his administration build urban and rural roads, rehabilitate hospitals and execute other developmental projects.
Mr. Bindow assured the lawmakers that the term loan – N8.7 billion – would be consolidated and restructured with the state’s existing term loan obligation of N11.7 billion with Zenith Bank Plc.
During the House of Assembly’s plenary session, chaired by the Speaker, Ibrahim Mijinyawa, the Deputy Majority Leader, Mohammed Matawalle, raised a motion to approve the loan facility sought by the state government.
Mr. Matawalle, who represents Gurin constituency, described the loan as a lifeline to the people of Adamawa State.
While seconding the motion, the chairman of the Committee on Budget Appropriation and Planning, Abdulrahaman Isa, described the loan as timely, saying the loan will go a long way in bringing infrastructural development to the state.
He reasoned with the state government’s arguments that it could only execute new projects after securing loan and alleged that the state faces the cash crunch due to mismanagement of public finances by the past government.
The lawmakers also approved a letter titled: “Request for the Restructuring of all Commercial Banks loans into Federal Government of Nigeria Bonds.” The letter authorised the restructuring of the commercial bank loans into bond on behalf of the state.
The commercial bank loans owed by the state as at June 30, 2015 show that Zenith Bank had an outstanding term loan of 11,700,547,558.6.