The Federal Mortgage Bank of Nigeria (FMBN) has demonstrated significant progress in its mission to provide affordable housing solutions, reporting substantial growth and operational improvements over the past year. Under the leadership of Managing Director/Chief Executive, Shehu Osidi, the bank has focused on strengthening its financial position, enhancing operational efficiency, and expanding its reach to a wider segment of the Nigerian population. A key indicator of this progress is the substantial increase in approved housing loans, reaching N71.5 billion, a marked improvement from the N39.7 billion disbursed in the previous year. This growth reflects the bank’s commitment to facilitating homeownership and stimulating the housing sector. Coupled with this increased lending activity, FMBN has implemented various measures to improve its overall financial health and operational sustainability.
A central achievement of FMBN in the past year is the attainment of an operational surplus of N11.58 billion, a historic first for the institution in over three decades. This financial turnaround signifies a positive shift in the bank’s operational trajectory and underscores the effectiveness of the implemented cost-efficiency measures and prudent financial management. While acknowledging the possibility of adjustments to this figure due to impairment factors, Osidi emphasized the management’s proactive approach to addressing non-performing loans, a legacy issue that has historically hampered the bank’s performance. The focus on tackling these bad loans reflects a commitment to long-term financial stability and the efficient utilization of resources. The bank has also implemented stricter loan appraisal processes to mitigate future risks and improve the overall quality of its loan portfolio.
Beyond financial improvements, FMBN has also witnessed significant growth in its core operational areas. Collections for the National Housing Fund (NHF) grew by N3 billion, reaching a total of N103 billion. This growth is further supported by an increase in registered employers and employees under the NHF scheme. The re-enrolment of Kano State civil servants into the NHF scheme after a 24-year hiatus is a significant achievement, promising to further boost NHF collections in the coming years given the state’s large workforce. Concurrently, FMBN has prioritized returning funds to beneficiaries, refunding N14.4 billion to over 44,000 individuals, demonstrating its commitment to efficient fund management and beneficiary satisfaction.
FMBN’s commitment to affordable housing extends beyond individual loans to encompass large-scale housing projects. The bank has provided a substantial N100 billion off-taker guarantee for the Renewed Hope Housing Projects nationwide, demonstrating its dedication to supporting government initiatives aimed at addressing the housing deficit. Direct funding for projects in Karsana, Abuja, and Ibeju Lekki, Lagos, further underlines FMBN’s active role in facilitating the development of affordable housing units across the country. These investments contribute directly to increasing the supply of affordable housing and stimulating economic activity within the construction and related sectors.
Recognizing the critical role of technology in modernizing operations, FMBN has made significant strides in implementing its Core Banking Application (CBA). The transition to a more technologically advanced platform streamlines transactions, enhances efficiency, and improves data management. With the majority of transactions already being conducted under the CBA, the bank anticipates full implementation by March 31, 2025. This technological upgrade will significantly enhance the bank’s operational capacity and customer service capabilities. Alongside technological advancements, FMBN has also focused on addressing the challenge of non-performing loans, recovering over N10.9 billion through dedicated recovery task teams and an additional N3.1 billion through regular recovery activities.
Furthermore, FMBN is pursuing a significant recapitalization effort to bolster its financial foundation. Acknowledging the current N2.5 billion paid-up capital as grossly inadequate, the bank is working towards securing a N500 billion capital injection, with half expected from the Federal Government and the remainder to be raised through debt capital. This injection of capital will significantly strengthen the bank’s lending capacity and enable it to expand its reach to a wider segment of the population. In addition to recapitalization, FMBN is actively engaging with stakeholders, including the Federal Executive Council, the Central Bank of Nigeria (CBN), and the National Assembly, to address regulatory hurdles impacting its mortgage financing capabilities. Clearing the backlog of unapproved audited accounts is another key achievement that strengthens the bank’s financial transparency and accountability. The introduction of non-interest mortgage loans, approved by the CBN, expands the bank’s product offerings to cater to a broader range of customer preferences and financial needs.
