The House of Representatives Committee on Banking and Other Ancillary Institutions has called for the immediate establishment of a judicial task force to expedite the trial of loan defaulters owing the Asset Management Corporation of Nigeria (AMCON).
This taskforce aims to ensure that 350 debtors, representing over 80% of AMCON’s total loan accounts, fulfill their financial obligations and contribute to the country’s economic recovery.
Chairman Eze Nwachukwu made this statement during an interview at the ongoing 2024 Retreat of the House of Representatives Committee on Banking and Other Ancillary Institutions with AMCON in Enugu.
He expressed disappointment that 350 Nigerian obligors are withholding collective resources and constraining the nation’s economy.
Nwachukwu emphasized the need for urgent action, stating, “We can’t fold our hands and watch them walk away with our collective resources. We have the list of these obligors and will come up with a resolution to address the challenges AMCON faces, including the establishment of a Judicial Taskforce to speed up the recovery of debts.”
He questioned why political cases receive prioritized attention while economic challenges are left unaddressed, saying, “If political cases have lifetime attention, why not prioritize our nation’s economic challenges?”
Nwachukwu vowed to take action, stating, “We can’t continue to sit back and watch these obligors walk away while the country suffers economic hardship.”
Earlier, Nwachukwu explained that AMCON was established to stabilize and revitalize Nigeria’s financial system by resolving non-performing loans and recovering value from distressed assets.
He commended AMCON’s progress in fulfilling its mandate, contributing to the resilience of the banking sector and the broader economy.
“However, as we look to the future, we recognise that the economic landscape is evolving rapidly. Global and domestic challenges require us to reassess our strategies and adapt to new realities.
“This retreat presents an opportune moment to reflect on AMCON’s journey so far, to identify areas where we can enhance its capacity, and to align our efforts towards ensuring that the Corporation continues to be a key player in our nation’s economic stability.”
He stated that the theme of the retreat, “Revitalizing Asset Management for Economic Stability: Exploring Policy Changes and Legislative Support for AMCON,” is not only timely but also critically important. “The task of managing distressed assets is complex, requiring robust policies, innovative approaches, and unwavering legislative backing.
“Revitalisation, in this context, means more than just improving existing processes; it involves a rethinking of the entire framework within which AMCON operates. It calls for strategic adjustments that will enable AMCON to be more proactive, agile, and effective in its interventions.
“Policy is the bedrock upon which effective asset management is built. We must examine our current policies with a critical eye, identifying gaps that hinder AMCON’s operations and proposing reforms that will enhance its effectiveness. Whether it’s in the areas of asset recovery, debt resolution, or stakeholder collaboration, our policies must be forward-thinking and adaptable to the changing economic environment.
“We must also consider the broader economic implications of these policies, ensuring that they contribute to sustainable growth and development,” he stated.
In his address, the Managing Director and Chief Executive Officer of AMCON, Mr. Gbenga Alade, disclosed that the Corporation has 1,865 cases in the Courts from Federal High Court to the Appeal Courts & Supreme Court in efforts to recover loans purchased from Banks debtors.
“Out of the 12,743 loans purchased, only 350 obligors constitute more than 80% of the total purchased accounts. Out of the 350 obligors, about 246 are in various Courts with us. This has continued to pose a major recovery challenge to the Corporation.
“Obligors hide under legal technicalities to tie AMCON in Courts, exploring the loopholes in the statutes and the legal system,” Alade lamented.
Represented by Mr Lucky Adaghe, the AMCON boss, however, revealed that despite the challenges, actual contributions to the funding plan from AMCON stands at 34% as at December 2023. “Cash Redemption of Bonds (Sinking Fund) and contributions by Bank/CBN to Sinking Fund make up the remaining 66%.”
On recoveries so far, Alade noted: “To date, the Corporation has made recoveries in the sum of N1.9tn. Of the total recovery, cash recovery represents 43%, sale of 4 bridged banks 13.3%, sales of proprietary shares 11%, claw back & repurchases 9.5%, asset sales & rentals 9.4%, investment income 7.2%, proprietary assets (unsold) 3.1% proprietary shares (unsold) 3.1% and divestment from portfolio 0.3%.”
He also commended the committee for their continuous support for the corporation’s drive to fulfill its mandate and obligations.
