As the slide in crude oil prices continues to send shock waves across producing countries, companies and funding institutions, the Group Managing Director and Chief Executive Officer of Diamond Bank Plc, Mr. Uzoma Dozie reasons that Nigerian banks, including Diamond Bank will not shy away from refinancing oil assets with high prospects in terms of reserves and production, ThisDay reports
He noted that given the fact that financing deals were structured on the basis of $100 per barrel of oil. it was definitely a shock but also a business reality that the price of oil crashed. He said the most important thing is that there will be reserves that will enable the banks to be paid out in the long run since oil prices would definitely rise again. He added that, in financing Neconde in OML 42, his bank’s assumption was that even at low oil prices they will grow the production and that is exactly what has happened.
He also said that his bank was not discouraged from funding new acquisitions or refinancing assets in view of the turn of events at the global oil market, as even though the level of demand has dropped, as long as the fundamentals in place through the life of the loan are there, then there shouldn’t be major grounds for concern.