The last has not been heard of the huge non-performing loans that distressed the banking industry recently,as the Asset Management Company of Nigeria (AMCON) on Thursday said the debts have not been forgiven.
The Managing Director, of AMCON, Chike Obi, during a road show organised in Abuja by the company to enlighten the public on its operations, achievements made so far and the company’snextline of activities,disclosed its resolve to pursue the debtors and recover all outstanding loans within the next two years.
An Executive Director of the company,Foluke Dosumu,explained that what AMCON did by purchasing a total of N4.2 trillion EBA at a cost of N1.7 at a proportion of about 44 kobo to a naira, was clean up the balance sheet of all the Nigerian banks by purchasing all loans that were not performing,and those that had exceeded single obligor limits or which constituted systemic risks to the Nigerian banking sector.
“The obligors now owe AMCON, meaning that those loans that it has taken over from the banks are now owed to AMCON. It is important to stress that within the AMCON law, it has extra powers to go after these obligiors to ensure that these loans are fullypaid. These loans are not forgiven, therefore it an illusion to think that when the loans come to AMCON, the obligors no longer owe. They indeed owe and AMCON intends to recover those loans,” she stressed.
AMCON was established in 2010 to buy up the non-performing loans of the nation’s banking system and recapitalise eight fragile banks that almost collapsed but for the timely intervention of the Central Bank of Nigeria (CBN).
Although the total worth and volume of outstanding loans was not disclosed,Obi noted that AMCON has become the largest domestic issuer of bonds and has 12,000 loans and assets of about N5 trillion,which makes the company the largest financial institution in Nigeria.
Lamido Sanusi, Governor of the Central Bank of Nigeria (CBN),noted that the forum was meant to educate and open up AMCON,especially to the legislator. Sanusi was represented by Sueiman Barau, Deputy Governor, Corporate Services, CBN.
“Since 2011, the Non-Performing Loans situation has improved significantly. The target is for it to be at average of 5 percent and that is where we are close to.Liquidity and capital adequacy ratio has also increased across the sector. The achievements recorded by AMCON are so far laudable,” Sanusi said
Culled from thedailytimes