Asset Management Corporation of Nigeria (AMCON) is running out of time and has resolved to go public with list of the names of its debtors described as maintaining “recalcitrant postures.”
This is the second time in two years that the Corporation makes this move. The first was in 2016 and generated a raft of court cases.
“The list will be published as soon as it is ready. We are taking time to scrutinise it to avoid legal glitches. In line with our mandate, we have to recover the debts and time is running out. There are details I cannot unveil now,” Jude Nwauzor, head of corporate communications at AMCON, told BusinessDay.
In a July 1 interview with the News Agency of Nigeria (NAN), Ahmed Kuru, managing director/CEO of AMCON, said the corporation sat on a N5.4 trillion debt.
Part of the N5.4 trillion had been with the banks for five years before AMCON bought over the bad loans, and after seven years of the companies’ operations, the obligors are yet to pay.
Resolutions through staggered plans have never worked. Let us not forget that before those loans were transferred to AMCON, they have been with the banks for over five years.
“We have changed our strategy from sitting down and drinking tea, and the obligors telling us lies and we pretend that we don’t know you are telling us lies.
“There is no more time for lies because we have a sunset period. So, now our focus is on recovery. We do not want to hear anything; you cannot come and tell me you are going to pay me in the next six years, I do not have that time,” Kuru stated.
AMCON is a creation of the National Assembly in response to the global financial crises of 2008/2009. It acquired over 12,000 non-performing loans worth about N3.7 trillion from 22 banks.
Out of this, AMCON injected N2.2 trillion as financial accommodation to 10 commercial banks in order to prevent systemic failure. This singular action, helped stabilise the financial system, protecting about N3.66 trillion of depositors’ funds; and saved approximately 14,000 jobs.
The recent move by AMCON to publish list of debtor it says have “wilfully maintained recalcitrant postures while also adopting unscrupulous means of avoiding recovery” points to a similar move taken by the Central Bank of Nigeria in 2015, when it directed Deposit Money Bank (DMB) to publish the list of debtors.
“I think when they did it few years ago after they set up AMCON, a number of customers who owed banks money were afraid and they quickly went to pay. They got a lot of money by this action. Even though a couple of them took AMCON to court to challenge their authority to do so but I think AMCON won some and lost some eventually,” Ayo Akinwunmi, head of Research FSDH Merchant Bank, told BusinessDay on phone interview
“For me it is not good for anybody to owe a bank and think that they can then go around freely in society and carry as if nothing has happened. If these actions will enable debtors to pay back debts it’s okay. Remember that this money does not belong to banks themselves,” Akinwunmi said.
There is a legal catch to AMCON’s move to publish the list of names of debtors. In June, 20018, a federal high court sitting in Lagos ordered AMCON to pay Bolanle Babalakin, chairman of Bi-Courtney Group of Companies, N3 billion for publishing his name as a debtor.
In 2016, AMCON had published the names of 217 people whom it tagged its chronic debtors.
