FG To Blacklist Firms, Individuals Over N5tr AMCON Debts

The Federal Government at the weekend expressed dismay at the slow recovery of the Asset Management Corporation of Nigeria (AMCON) N5tr outstanding debt, following which efforts are being made to blacklist high-profile institutions and individuals that have frustrated recovery efforts so far.
Vice President, Prof. Yemi Osinbajo, announced this when he received members of the board and management of AMCON, led by the Board Chairman, Dr. Muiz Banire at the State House, Abuja, accusing the recalcitrant debtors of holding the entire nation to ransom by their bad behaviour.

Congratulating AMCON for recovering over N1tr worth of debts in cash and assets despite the difficulty of debt recovery, be expressed the commitment of the Muhammadu Buhari administration to collaborate with the Ahmed Kuru “administration to ensure that these monies are recovered from AMCON obligors because it will help our economy and provide the government with more money to continue to improve on the development of infrastructure across the nation.”

Osinbajo, who is Chairman of the National Economic Council (NEC), spoke of plans for an inter-agency collaboration framework that would comprise relevant government Ministries, Departments, and Agencies (MDAs). The framework, which will be supervised by the office of the Vice President, is to ensure that such debtors do not engage in business with government henceforth.

Recall that when AMCON purchased the non-performing loans of the country’s banks almost a decade ago, bonds with sovereign guaranty were issued to holders, making government the ultimate guarantor.
Continuing, the Vice President said, “the time has come for us (Federal Government) to set some examples with some of these top debtors of AMCON, which I believe will set a good example and serve as a deterrent to others.”

The Vice President also expressed satisfaction with the recovery efforts against all odds by the AMCON management under the leadership of Ahmed Lawan Kuru. He assured that the Federal Government would offer the necessary support that will enable the corporation to go after obligors that have remained recalcitrant despite the efforts at an amicable resolution of the debt over the years by the agency.

As part of the plan, Prof. Osinbajo, in the next couple of days, plans to invite the AMCON team alongside other relevant MDAs to fine-tune plans on how to ensure that debtor individuals and agencies to AMCON are treated as enemies of the Nigerian state and its people.

Earlier in his presentation, Dr. Banire highlighted some of the challenges and frustrations faced by AMCON as a result of the attitudes of some debtors who have continued to behave as if they are above the law.

While urging the government to assist the corporation to succeed, Banire said: “AMCON has been able to recover over N1tr 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 N1tr.

“As at end of December 2018, AMCON’s Assets Under Management (AUM) amounted to about N172.5bn. It is noteworthy to state that out of the total real estate properties, assets available for sale is valued at N62bn. Of this N62bn, about 83% comprises of bare land and other assets, which may need considerable improvements to convert into income generating assets.

“Your Excellency may recall that in September 2018 following the takeover of Skye Bank Plc by the Central Bank of Nigeria (CBN) and the Nigeria Deposit Insurance Corporation (NDIC), AMCON was again invited to inject a total sum of NN898.45bn as capital, thereby leading to the emergence of another bridged bank named Polaris Bank Limited.

“The intervention in Skye Bank was caused majorly by internal abuse by the operators. As a result of that development, AMCON’s total debt obligation to the CBN is currently in excess of N6tr. And 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.

 But, despite the successes recorded, the corporation has been facing a number of challenges, 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, which is why we need a new strategy to enable AMCON meet its mandate before sunset.”

In his own presentation, Kuru, while acknowledging the support enjoyed over the years from the Vice President, expressed excitement at the planned inter-agency collaboration, which he believes, would ensure all sister agencies are on the same page in the interest of the country.

He reminded the Vice President that AMCON’s debt sits on government’s balance sheet with CBN and that failure to recover may result to serious consequences including recourse to taxpayers’ money, a situation that must be avoided.
For an organisation like AMCON with sunset date, he appealed for all of the necessary support, adding that with the huge portfolio of debt, no obligor must be allowed to go free, no matter how highly placed in the society.

Photo Caption: Vice President, Federal Republic of Nigeria, Prof. Yemi Osinbajo, in a handshake with the chairman of Asset Management Corporation of Nigeria (AMCON), Dr. Muiz Banire. With them are: Ahmed Lawan Kuru, Managing Director/CEO, AMCON (standing 4th from right) with other members when the Vice President hosted the AMCON board and management at the State House Abuja, at the weekend.

https://investdata.com.ng/2019/05/fg-to-blacklist-firms-individuals-over-n5tr-amcon-debts/