CBN Extends Covid-19 Tolerance On Intervention Loans By One Year

Central Bank of Nigeria (CBN) has announced an extension of its regulatory tolerance on the restructuring of its intervention facilities for another one year.

The Apex Bank made this known via a circular signed by Dr. Kevin Amugo, the director of Financial Policy and Regulatory where it said it will continue to charge its borrowers an interest rate of 5percent per annum as against the 9percent originally offered. 

The CBN had earlier on March 1, 2020 reduced the interest rates on its intervention loans from 9 percent to 5 percent as part of its response to the economic downturn due to Covid-19 induced lockdowns.

It also also offered to rollover moratorium granted on all principal payments on a case by case basis. All credit facilities had been granted a one-year moratorium starting from March 1, 2020 when the pandemic was first recorded in Nigeria.

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“The Central Bank of Nigeria reduced the interest rates on the CBN intervention facilities from 9% to 5% per annum for one-year effective March 1, 2020, as part of measures to mitigate the negative impact of COVID-19 Pandemic on the Nigerian economy,” statement reads in part

"Credit facilities, availed through participating banks and OFIs, were also granted a one-year moratorium on all principal payments with effect from March 1, 2020.

"Following the expiration of the above timeline, the CBN hereby approved as follows;
(1) The extension by another twelve (12) months to February 28, 2022 of the discounted interest rate for the CBN intervention facilities; (2) The roll-over of the moratorium on the above facilities shall be considered on a case by case basis," it concluded.