The Senate on Tuesday began investigation into the crisis between Etisalat (now 9mobile) and 13 Nigerians banks over a $1.2bn loan and warned that the crisis, if not well managed, could cause problems in the banking sector.
It also demanded a review of the public corporations privatised by the Federal Government.
The upper chamber of the National Assembly specifically mandated its Committee on Privatisation to engage the National Council on Privatisation and the Bureau of Public Enterprises to determine the current status of the companies.
The probe of Etisalat, which has transformed to 9mobile, was based on the adoption of a motion by Senator Olamilekan Adeola (Lagos-West) at the plenary on Tuesday titled, ‘The need for Senate’s intervention in the recent Etisalat (Nigeria) $1.2bn debt crisis.’
Prayers of the motion, which were unanimously granted by the lawmakers, include to mandate the Committees on Banking, Insurance and Other Financial Institutions; Communications; Capital Market; and National Security and Intelligence “to investigate the management and utilisation of the $1.2bn loan facility obtained from the 13 Nigerian banks.”
The lawmakers also mandated the joint committee “to make recommendations on ways the Nigerian financial governance structure can be strengthened by legislations to prevent any future similar reoccurrence.”
They urged “the relevant financial intelligence agencies of the Federal Government to investigate the management of Etisalat Nigeria and hold the defaulting parties accountable for their actions.”
Adeola, in the motion, noted all the UAE shareholders of Etisalat Nigeria, including state-owned investment fund, Mubadala, had exited the company, with the resignation of top key management officers of the company.
He added, “The Senate regrets that although it should ordinarily not be the duty of the Senate to wade into individual debt crisis of private sector businesses, the Senate is convinced that if this situation is not properly handled, it will have negative implications on the Nigerian business environment and foreign investments in Nigeria in general.
“The Senate regrets that a loan of this magnitude has the capacity of setting off another banking crisis in Nigeria, with banks looking for bailout once again.”
Also, the review of the public corporations was sequel to the unanimous adoption of a motion by Senators Umaru Kurfi, Abu Ibrahim, Yahaya Abdullahi, Mustapha Bukar, Abubakar Kyari, Tijjani Kaura and Andy Uba, titled ‘The Need to Review the Privatisation of Public Enterprises in Nigeria.’