Reps insists on recovery of N4.8tr owed AMCON before sunset
BY FRANCIS EZEM
The House of Representatives, Nigeria’s lower legislative chambers has insisted that all the N480billion owed by some highly placed individuals in including politicians must be recovered by the Asset Management Corporation of Nigeria AMCON, the country’s public debt recovery agency before its sunset in 2024.
This is coming about one week after the Senate Committee on Banking, Insurance and other Financial Institutions called on President Muhammadu Buhari to issue an Executive Order for the seizure of assets of persons indebted to the corporation.
Chairman of House of Representatives Committee on Banking and Currency, Jones Chukwudi Onyereri, who made the disclosure, assured that the House under the leadership of the Speaker, Yakubu Dogara will work with the Senate for a quick passage of the AMCON Amendment Bill, which will ensure the Corporation gets all needed support from the National Assembly to meet its mandate.
While at the ongoing three-day retreat in Kano, Onyereri said given the sunset date of AMCON, which he stated was created by the government not to operate in perpetuity, the National Assembly, the executive and the judiciary must ensure that the agency met its obligation within the expected and acceptable timeframe.
“Earlier this year, we had a public hearing and a technical session on the AMCON Amendment Bill. The report on the bill is out and will soon be presented before the House.
This shows our commitment in ensuring that AMCON gets all the support it needed from the National Assembly in carrying out its mandate. This bill is very important and we promise to work with the Senate in ensuring a quick passage of the bill. As we are all aware, AMCON was not created to exist in perpetuity.
“There is a sunset date for AMCON and it is expected to have achieved its mandate before the sunset date. Therefore, and more importantly, we are here to interact with AMCON to see how we can further help in making sure that AMCON achieves this mandate for the common good of the country”, he said.
Managing Director/CEO of AMCON, Mr. Ahmed Kuru, while speaking at the event, said he needed support at this critical moment in the life of the corporation, disclosing that the obligors are getting bolder by the day and employing all kinds of tricks to tie AMCON up in court.
It was gathered that the corporation currently has over 3,000 cases in various courts, across the country with obligors who have the means to pay but are still doing business with other names but have vehemently refused to pay what they owe AMCON.
He said: “AMCON having achieved remarkable milestones in the last seven and half years of its creation, is willing to deliver even more if given the needed support from all key stakeholders such as the legislature, the judiciary, the executive among others.
“The corporation has fully redeemed all Federal Government- guaranteed bonds issued to the commercial banks for purchase of non-performing loans. The face value of the bonds was N3.7trillion; the banks became stable and were able to support businesses. AMCON has also successfully divested from the three bridge banks—Mainstreet, Enterprise and, Keystone banks; It has recorded total recoveries worth N975billion of which cash and assets account for 60 per cent and 40 per cent, respectively. Out of the total number of Eligible Bank Assets EBAs acquired, AMCON has fully resolved approximately 4,300 leaving approximately 8,400 and AMCON intervened in key sectors of the economy such as aviation and agriculture.”
He listed some of the challenges facing the corporation to include high cost of human and material resources as well as the several court cases with the attendant financial cost.
“One of the major areas for amendment is the matter of vesting proprietary interest of all collateral assets acquired by AMCON from commercial banks. The proposed amendment should have retrospective effect. The vesting of proprietary interest of all collateral assets in the resolution vehicle was implemented in Malaysia and was instrumental to their success in recovering debt obligations.
“Our second major challenge has to do with the disposal of assets due to the economic downturn. AMCON’s current Assets Under Management AUM, which covers assets obtained from debt resolution, has a book value of N182 billion, which we are unable to sell. Our ability to successfully divest these assets, at competitive market price, is severely hampered by several factors including valuation methodology, unperfected title documents, state of the economy, purchasing power etc. Our third challenge is the uncooperative attitudes of select obligors who are either unwilling and/or unable to settle their indebtedness. Such debtors prefer to resort to all manner of diversionary tactics as opposed to dealing with the problem of their indebtedness. It sees most of them are buying time, to where we do not know!
“It is evident that we have exhausted the low hanging fruits and have to roll up our sleeves for a drawn out battle as it becomes harder to get obligors to settle their debts. To clarify, obligors indebted to AMCON for the sum of N1.3 trillion, they have sued us in various courts in Nigeria raising technicalities to avoid meeting their obligations. This has hampered our recovery efforts and our objective of obtaining the best achievable financial returns on assets acquired from the banks”, the MD also lamented.