The lingering crisis which has engulfed the Nigerian Shipowners Association (NISA) and which snowballed into counter claims last week has started affecting their businesses. Commercial banks operating in Nigeria have stopped processing loan applications for vessel acquisition and other services from members of the association.
The NISA is the umbrella body for all ship owners in Nigeria. It has been enmeshed in sharp disagreements since last; shortly year after the emergence of Capt Niyi Labinjo as its President.
The lingering crisis which has engulfed the Nigerian Shipowners Association (NISA) and which snowballed into counter claims last week has started affecting their businesses. Commercial banks operating in Nigeria have stopped processing loan applications for vessel acquisition and other services from members of the association.
The NISA is the umbrella body for all ship owners in Nigeria. It has been enmeshed in sharp disagreements since last; shortly year after the emergence of Capt Niyi Labinjo as its President.
Sources at some banks who confirmed the development to our correspondent last week attributed it to the emergence of two factions in the association; one being led by Capt Labinjo and the other by Aminu Umar as acting president.
Even though Shipping Position Daily could not ascertain the actual number of such applications that have been rejected, our sources on the maritime desks of two banks affirmed that there have been skepticisms as to which faction to acknowledge and hold as “corporate guarantors”.
But confirming this last week, in Lagos, the Secretary General of the Umar faction of the association; Mr. Tunji Brown told members who attended the faction’s meeting that banks are not comfortable with the division. He however did not give any details, beyond the alarm that he raised.
But accentuating the banks' dilemma, the Tunji Brown group has also allegedly gone ahead to open new accounts with other banks in the name of NISA.
At last week’s meeting which was also attended by the association’s former President; Chief Isaac Jolapamo, the factional Secretary however harped on the need to reconcile the two sharply divided groups.
He nevertheless blamed the President; Captain Labinjo for the crisis rocking the association.
But, speaking with our correspondent last week, Capt Labinjo said it is laughable to say that banks are rejecting loan applications on account of the crisis.
“That can not be true, if you have genuine and commercially viable proposal, there is no bank that will reject such an application. The banks have no business with what is happening at NISA. Any ship owner who has genuine need for facilities can approach the banks for such, provided the application is attractive, the banks want to make money too”, Capt Labinjo told our correspondent.
But, Mr, Eddy Idigo of Fidelity Bank affirmed that the banks are very concerned about the crisis in the association.
Idigo said that it will not be proper to offer facilities to a group that cannot provide corporate guarantee for such loan applications. He also confirmed that the banks are just being careful.
Similarly, a staff of Skye Bank who pleaded anonymity stated that there has been a reduction in approval for facilities from members of NISA “in recent time”.
He told our correspondent that Skye Bank is a leader in granting loans either for fleet re-tonnage or dry-docking, and that many of the association’s members had benefitted from that relationship with the bank.
He however did not confirm if the crisis in the association has anything to do with the dwindling loan approval.
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