Nigeria: FG to seize payment, assets of AMCON debtors
London, Jan. 28, 2019 (AltAfrica)-Frustrated by refusal to settle their N5 trillion obligations to Assets Management Corporation of Nigeria (AMCON), Federal Government says it will begin to confiscate financial benefits accruing to such debtors.
Minister of Finance, Mrs Zainab Ahmed, said at the inauguration of AMCON board of directors at the weekend that government will also stop conducting further business with such obligors.
“I have been briefed on some of the challenges facing the Corporation, which includes obligors resorting to all manner of tactics to avoid honouring their obligations.
“Whilst some are still enjoying government patronage, others are using the judiciary and adopting on legal technicalities to stall recovery.
“It must be emphasised that government would not deal with debtors that have failed to honour their obligations with AMCON.
“Payments due to some of these obligors will be put under lien until they enter into a resolution agreement with AMCON.
“This is because AMCON’s debts sits on the government’s balance sheet with CBN,” Ahmed declared.
According to the Minister, at inception, AMCON acquired over 12,000 non-performing loans worth approximately N3.7 trillion from 22 commercial banks and injected N22 trillion as financial accommodation to 10 banks.
“The direct impact of that action is seen in the protection of about N3.66 trillion of depositors’ funds and approximately 14,000 jobs were saved.
“In fulfilment of its mandate, AMCON has recorded remarkable achievements in major sectors of the economy including oil and gas, maritime, aviation, solid minerals and indeed, banking.
“AMCON has been able to recover over N1trillion since inception to 2018-year end.
“Out of the recovered sum, cash accounted for 60% while non-cash assets such as properties and equity securities accounted for the balance of 40%.
“Over the same period, AMCON’S repayment of its indebtedness to the CBN was over N1trillion.
“AMCON’s total debt obligation to the CBN, is currently in excess of N5 trillion.
“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 charged the board to provide policy direction and implementation of programmes for the achievement of its mandates rather than interfere with its day-to-day affairs.
Earlier in his address, Managing Director of AMCON, Ahmed Kuru, had confessed that recovering the debts is most difficult but expressed confidence that with inauguration of the board, things would become easier.
“It is not an easy task but the Act has provided for the situation that we are going through. We have been able to recover N1trillion but we have more than N5trillion that is outstanding.
“If today AMCON disposes all that is in its possession, we may be able to recover maybe N1trillion, willing buyer-willing seller because the framework provides that it should be able to accommodate the N2.2trillion because most of the assets we are holding are from the banks and they were overvalued.
“So if today I sell all the assets in my possession-if there is a willing buyer- I won’t be able to recover N1trillion.”
Also speaking, chairman of the newly inaugurated AMCON board Mr. Muiz Banire assured the minister that board members and management of AMCON will live up to expectation and not fail in their assignment.