RismadarVoice Reporters
October 21, 2026
The Oyo State House of Assembly has approved Governor Seyi Makinde’s request to obtain a fresh ₦100 billion loan for infrastructure development and refinance an existing ₦300 billion contractors’ financing facility.
The approval was granted during plenary on Wednesday, October 21, following the presentation of a letter from the governor to the Speaker of the Assembly, Adebo Ogundoyin.
Under the arrangement, the state government will obtain the additional ₦100 billion from United Bank for Africa (UBA) Plc to finance critical infrastructure projects and accelerate the completion of ongoing developments.
The separate ₦300 billion component involves transferring an existing contractors’ loan from Access Bank to UBA under revised financing terms.
According to details presented to lawmakers, the refinancing will reduce the annual interest rate on the existing facility from 26 per cent to 22 per cent, representing a reduction of four percentage points.
The government expects the arrangement to reduce borrowing costs, although the actual savings will depend on the outstanding debt, repayment terms and associated charges.
The fresh ₦100 billion facility will also attract an interest rate of 22 per cent, subject to adjustments based on prevailing money market conditions.
Its repayment period is 48 months, with an annual management fee of 0.25 per cent and an advisory fee of 0.5 per cent, both calculated on the outstanding balance.
The loan agreement also provides for a three-month moratorium on principal and interest payments.
However, interest accumulating during the moratorium will remain payable alongside the fourth, fifth and sixth instalments.
During deliberations, Deputy Speaker Muhammad Abiodun Fadeyi and other lawmakers defended the financing proposal, arguing that sustained infrastructure investment was necessary to promote economic development.
They identified the LAUTECH Teaching Hospital in Oyo town, the Rashidi Ladoja Circular Road and the Ido-Eruwa Road as major projects requiring continued attention.
The legislators maintained that completing ongoing projects would improve transportation, create employment opportunities and strengthen access to essential public services.
Meanwhile, the proposed borrowing has attracted criticism from opposition figures concerned about the state’s debt obligations.
The Assembly’s approval authorises the administration to proceed with the financing arrangements, but does not establish that the funds have already been disbursed.
Importantly, the ₦300 billion refinancing represents the restructuring of an existing obligation rather than an additional ₦300 billion in fresh borrowing.
The new ₦100 billion facility, however, will increase the state’s borrowing commitments, making transparent project execution and effective debt management important to the arrangement’s financial sustainability.
