N5trn Debt: AMCON Plans Moratorium For Committed Debtors

– Seeks Senate’s Support To Recover Bad Loans

The Asset Management Corporation of Nigeria is seeking the support of the Senate to recover the over N5tn debt owed the corporation by chronic debtors.

The Managing Director/Chief Executive Officer, AMCON, Mr Ahmed Kuru, said this when he led the management of AMCON to appear before a technical session of the Senate Committee on Banking Insurance and other Financial Institutions in Abuja.

The committee met to review the impact of COVID-19 on AMCON policies and process with a view to repositioning AMCON for optimal performance amidst the pandemic.

In view of the fact that AMCON is approaching it’s terminal date, Kuru said it had become imperative to get the support of the lawmakers in resolving all the pending cases of loan recovery.

Kuru told the committee that the Senate needed to do more to support the recovery efforts of AMCON as some of the top obligors of the Corporation still hide under legal technicalities to delay court proceedings.

The AMCON Boss said these obligors explore the loopholes in the AMCON Act prior amendment, adding that the development had slowed judicial process including undue adjournment, and lack of hearing date among others.

He said, “We want the 9th Senate of the Federal Republic of Nigeria to pile pressure on some of our obligors through the Senate Committee on Banking Insurance and Other Financial Institutions under the leadership of Senator Uba Sani as Chairman.

“Some of these obligors are very important members of the society and, as distinguished senators, I know they have all it takes to intervene and even compel AMCON obligors to meet their obligation.

“This is because we cannot over emphasise the importance of recovering the huge outstanding and the positive impact it will have in the Nigerian economy, which like other economies have been further challenged by the outbreak of the dreaded coronavirus pandemic.”

 
Despite the challenges and frustrations, which have been heightened by the ravaging pandemic, the AMCON MD told the Senate committee that the Corporation is not deterred.

He noted that as of August this year, AMCON’s Assets Under Management amounted to about N136.73bn, while the Corporation has about N112.03bn worth of propriety assets.

He said that the pandemic has impacted negatively on the various sectors of the economy, particularly the sectors, which AMCON is substantially exposed to.

Some of these sectors are aviation, oil and gas, manufacturing, and retail sectors.

The AMCON Boss said the continuous rise in inflation and Naira depreciation has also affected the purchasing power of the public thereby affecting obligor’s capacity to repay.

He added that with the current development, the Corporation has begun consideration of granting moratorium to deserving obligors that had hitherto shown commitment towards resolving their indebtedness.

The AMCON CEO added, “COVID-19 pandemic has had a monumental impact on the globe and Nigeria in particular. Not only has it adversely affected the global economy, but the entire health system of the world has remained on its knees.

“AMCON, one of the institutions of government saddled with the responsibility of revitalising Nigeria’s economy is not immune to this monumental global disaster.

“The pandemic has impacted negatively on the various sectors of our economy, particularly the sectors, which AMCON is substantially exposed to, like aviation, oil and gas, manufacturing, and retail sectors.

“The continuous rise in inflation and Naira depreciation has also affected the purchasing power of the public thereby affecting obligor’s capacity to repay.

“Noting the untoward hardship caused by COVID-19 pandemic on most businesses and indeed the economy at large, the Corporation has begun consideration of granting moratorium to deserving obligors that had hitherto shown commitment/seriousness towards resolving their indebtedness.

“On our day-to-day operations, the Corporation has taken several measures to withstand and curtail the spread of this pandemic.”

On his part, the Chairman of the committee, Senator Uba Sani, assured that the committee and AMCON have identified the strategies being deployed by debtors to stall the repayment of loans, including the dragging of court cases for many years.

The Senator who represents Kaduna Central at the 9th Senate said, “The Asset Management Corporation of Nigeria has remained at the receiving end of these well laid and orchestrated acts of economic sabotage.”

 
He explained that the engagement with the management of AMCON had provided a window of opportunity for the committee to brainstorm on key issues and concerns in maintaining the continued stability of the financial sector, particularly the banking industry.

He further explained that the meeting also addressed the continued reduction of high rate of Non-performing Loans as well the challenges of AMCON, notably policies and procedures, implementation strategies and assets recovery in the heat of COVID-19 pandemic.

 
He said the Committee strongly believes that the provision for a Loan/Credit Tribunal will assist AMCON in its loan recovery efforts.

He assured that the 9th Senate would strongly consider all recommendations, which if strengthened, would further enhance the efforts of AMCON, thereby propelling the nation’s economy to the path of sustainable growth.