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The federal government is working on a plan to recapitalise Bank of Agriculture (BoA), one of the nation’s national development finance institutions, as part of efforts to revitalise the agricultural sector, bolster economic growth, and foster socio-economic development of the country. This was disclosed today in a statement by the Federal Ministry of Finance.

According to the statement, the Minister of Finance, and Coordinating Minister of the Economy, Wale Edun, said the government has taken decisive steps to reposition BoA, which he said is a critical institution in Nigeria's agricultural landscape.

During a meeting on a progress report at his office today, the minister highlighted the crucial role of the bank in boosting agricultural production and stabilising prices, according to the statement.

Mr. Edun reportedly said the National Council on Privatisation (NCP) has tasked its technical committee with developing a comprehensive roadmap for repositioning the bank, adding that with the right strategy and leadership, BoA can drive agricultural expansion and contribute to long-term economic stability in the country.

Data from the National Bureau of Statistics (NBS) shows crop production contributed 26.51% to the real GDP in Q3 2024. In the same period, agriculture grew by 1.14%.

Nigeria continues to grapple with agricultural productivity and food inflation challenges as the agriculture sector has for years been affected by insecurity, poor infrastructure, and low level of financing.

In December 2024, food inflation accelerated to 39.84%, according to the NBS, ahead of the rate of general price increases at 34.80%. To stem inflation, the Central Bank of Nigeria (CBN) raised its anchor interest rate to 27.50% at its November 2024 Monetary Policy Committee meeting.

The finance minister said that while monetary measures are being implemented, there is the need for fiscal, real-sector strategies to increase output, support economic growth, and dampen inflation.

Bank of Agriculture was founded in 1972 as Nigerian Agricultural Bank. It evolved to its current name in 2010, as part of the efforts to reposition (NAB). BoA is mandated to provide agricultural credit facilities to support all agricultural value chain activities, and to provide non-agricultural micro credit, savings mobilisation, and capacity development, according to information on its website.

The bank is wholly owned by the Federal Government of Nigeria through the Federal Ministry of Finance Incorporated and the CBN in the ratio of 60%: 40% respectively.

Based in Kaduna, northern Nigerian, BoA is currently being led by Lwan Ali Hassan as Acting Managing Director and Chief Executive Officer.

Its former CEO, Mohammed Santuraki, said in 2012 that BoA was under-capitalised. He disclosed that out of its authorised share capital of N50 billion, only N30 billion had been paid, leaving a balance of N20 billion.

Last year, Vice-President Kashim Shettima, who chairs the NCP, inaugurated a committee, headed by Mr. Edun, to work on a plan for the resuscitation of BoA. The plan is expected to be concluded in Q1 2025, according to the Minister of Agriculture and Food Security, Abubakar Kyari, when he briefed state house correspondents in Abuja last month.

“By harnessing the potential of the Bank of Agriculture, Nigeria can unlock its full agricultural potential and solidify its position as a leader in regional, global food production,” the statement by the Ministry of Finance concluded.