Banks To Minimise Loan Risks By scrutinizing Oil Contract

 Banks To Minimise Loan Risks By scrutinizing Oil Contract

The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, during a keynote address, has warned banks and other financial institutions to thoroughly scrutinize every oil contract before extending any line of credit to contractors in order to curtail the incidence of bad loans, The Nation reports.

While giving a ministerial review of credit management in the nation’s oil and gas sector, the minister observed that the credit management performance of the sector over the years has been noteworthy with numerous projects in the petroleum value chain attaining completion without incidents of liquidity issues.

The minister who was represented by Dr. Adetunji Oyebanji, Chairman/Managing Director, Mobil Nigeria Plc, was however quick to add that in order to improve the credit management performance in the sector, “The entire value chain from due diligence of the borrower to credit funding, credit utilisation, and repayment must be analysed in detail.”

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