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In a circular made available on its website yesterday, the CBN said the scheme which was meant to be terminated on September 30, 2016 will now be extended till September 30, 2025.
The circular issued to all deposit money banks and signed by the director, Financial Policy and Regulation, Kevin Amugo, stated that the extension was to further enhance credit supply to the agricultural sector of the economy.
The apex bank published a revised guideline for CACS stating that the reviewed strategy supersedes all former guidelines. It explained that the fund shall be made available to the participating bank(s) to finance commercial agricultural enterprises.
While it approved the participation of all deposit money banks under the scheme, the CBN stated that all participating banks are required to sponsor projects from any of the target areas indicated in the guidelines and bear all the credit risk of the loans they will be granting
According to CBN, the target agricultural commodities and value chains to be covered under the scheme are production of cash or food crops, poultry, processing, storage, farm input supplies and marketing.
The circular indicated that the single obligor for any project from a participating bank under the scheme would be N2 billion while it would be N1 billion for state governments.
In addition, the CBN said that each state government could borrow up to N1 billion for onward lending to farmers’ cooperative societies and other areas of agricultural development provided such initiatives or interventions are in line with the objectives of CACS.
The scheme, which would be financed from the proceeds of the N200 billion three-year bond raised by the Debt Management Office (DMO) is to be approved by CBN through the Board of Directors and the Committee of Governors.
http://leadership.ng/business/banking/372147/cbn-extends-cacs-termination-10-years
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