The Asset Management Corporation of Nigeria (AMCON) has, since its inception in 2010, recovered about N1tn from debtors of banks whose loans were taken over by the corporation.
The Minister of Finance, Mrs Zainab Ahmed, said this in Abuja while inaugurating the board of AMCON under the chairmanship of Mr Muiz Banire (SAN)
AMCON was set up by the Federal Government through the Central Bank of Nigeria to bail out banks through the purchase of non-performing loans and to recover loans from debtors.
The finance minister said that out of the recovered amount, cash accounted for 60 per cent, while non-cash assets such as properties and equity securities accounted for the balance of 40 per cent.
She said over the same period, AMCON’s repayment of its indebtedness to CBN was over N1tn, while it’s total debt obligation to the CBN currently stood in excess of N5tn.
She explained that going by the current economic realities, the Federal Government could not afford to write-off the debts in the short term.
She called on the new management board to come up with creative strategies to recover the outstanding loans since it had now become a moral obligation for the government to recover the outstanding liabilities.
She said, “At inception, the corporation acquired over 12,000 non-performing loans worth approximately N3.7tn from 22 commercial banks; injected N22tn as financial accommodation to ten banks.
“The direct impact of that action is seen in the protection of about N3.66tn of depositors’ funds and approximately 14,000 jobs were saved.
“AMCON has been able to recover over N1tn since inception to the 2018 year end.
“AMCON’s total debt obligation to the CBN is currently in excess of N5tn. It is evident that the Federal Government cannot afford to write off this debt in the short term hence, our moral obligation to pursue obligors and recover the debts owed.”
She admitted that the corporation had made significant progress in its management of toxic assets in the financial sector.
Ahmed said that the government would do all it could to recover debts to AMCON, hinting that payment to any contractor in this category might be frozen until such obligations to AMCON were met.
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Frontpage September 12, 2019