Fears AMCON debt may rise to N6.6 trillion by 2024

 

The Asset Management Corporation of Nigeria (AMCON) and its partners have been advised to leverage the 2019 Amended AMCON Act, to recover the over N5 trillion outstanding AMCON debt before the corporation’s sunset.

This is just as fresh fears were raised on the possibility of the AMCON debt shooting up to N6.6 trillion by 2024.

A legal consultant, Olaniwun Ajayi Balogun, while making a case in support of the amended act at a forum organised by AMCON for its external solicitors, in Abuja, also painted a gloomy picture of what could befall the already challenged Nigerian economy if the debts were not recovered in good time before the sunset period.

According to him, AMCON debt could easily rise to a whopping N6.6 trillion by 2024 because AMCON still owes the Central Bank of Nigeria (CBN) N4.5 trillion and also battling with N1.7 trillion of Assets Under Litigation (AUL).

Given the fact that the debt will eventually become the burden of the federal government and by extension taxpayers, he argued that there was need for speed in recovery just as all hands should be on deck to ensure that AMCON recovers the debt as mandated by the new amendments.

He said it was immoral to allow the obligors go without punishment especially since both Christianity and the Islam, which incidentally are the dominant religions in the country abhor people who borrow without the intention to pay back.

According to him, there were no legitimate means adopted by AMCON and its agents to recover the debt as empowered by the Amended AMCON Act that can be termed as draconian.

The process needed the additional powers, according to Balogun because AMCON operating at 100 per cent efficiency to realise the available collaterals would still face a 68 per cent gap to plug the unrecovered exposure, meaning that to plug the gap, AMCON should do whatever it takes including aggressively pursuing both primary and secondary obligors.

Balogun also expressed satisfaction with what he called the ‘key pillars of the 2019 amendment,’ which include tracing and tracking debtors hidden funds; naming and shaming recalcitrant debtors and making contracting with government subject to good standing with AMCON; holding selling Eligible financial institutions to their loan sale obligations and giving teeth to claw back rights and checkmating debtors’ legal gymnastics and exploitation of legal technicalities to frustrate recovery. Other key pillars include, fast tracking the hearing and determination of AMCON cases, enhancing AMCON’s rights over collateral securing Eligible Bank Assets (EBAs) from security interest to legal title; fine-tuning AMCON’s special powers as well as prescribing a sunset date.

AMCON Managing Director/Chief Executive Officer, Mr. Ahmed Kuru, said even though obligors of AMCON have been working hard to stretch AMCON to the sunset period, the corporation, under his leadership was determined to achieve its mandate within the limited time available (and within the law). He stated that the amended act indeed provided additional powers to an already strong act of AMCON as some obligors who hitherto were hiding from their obligation are now coming out to see how their debt can be resolved. He however added that the amendment can only be effective to the extent that solicitors of AMCON understand the Act and thereafter utilize the far-reaching powers that have been vested in the Corporation to help AMCON and Nigerian recover the debt.