Post Views: 107 •Amidst Fear Debt May Hit N6.6tr By 2024 Unlike in the past when they seeming snubbed the organisation, Managing Director of the Asset...
•Amidst Fear Debt May Hit N6.6tr By 2024
Unlike in the past when they seeming snubbed the organisation, Managing Director of the Asset Management Corporation of Nigeria (AMCON), Ahmed Kuru, on Tuesday said some hitherto recalcitrant bank customers whose toxic loans were purchased during the nation’s banking crisis are now coming forward to discuss ways of resolving their debt obligations.
Kuru linked the change of heart by individuals and organization who worked tirelessly over the years to delay repayment of their debts beyond the lifespan of the corporation, to the extra powers given the corporation by the recent amendment to its enabling Act.
Welcoming participants to a forum for external solicitors and Asset Management Partners (AMPs) of AMCON in Abuja, he said although the amended Act provides additional powers, it can only become effective and result oriented to the extent that solicitors of AMCON understand. Only then, he continued, can they thereafter utilize the far-reaching powers vested in the corporation to help AMCON and the Federal Government recover the debt.
The AMCON boss his management team is determined to achieve its mandate within the limited time available (and within the law) to recover the over N5tr outstanding AMCON debt before the corporation’s sunset.
While x-raying the newly amended 2019 AMCON Act recently signed into law by President Muhammadu Buhari, Muyiwa Balogun, a legal consultant, and Senior Partner, Olaniwun Ajayi –LP, challenged AMCON; its Asset Management Partners (AMPs) and the Inter-Agency Presidential Committee set up by the Federal Government to leverage the 2019 amended Act to recover the debt.
On why the tempo of debt recovery must increase without further delay, he warned that the debt could easily balloon to N6.6tr in five years’ time- by 2024, because AMCON still owes the Central Bank of Nigeria (CBN) about N4.5tr, while still battling with another N1.7tr worth of Assets Under Litigation (AUL).
Balogun listed ‘key pillars of the 2019 amendment,’ to include tracing and tracking funds belonging to identified recalcitrant debtors; naming and shaming; in addition making securing government contract subject to good standing with AMCON. The amended Act also empowers the corporation to hold banks that sold the bad loans to their loan sale obligations, besides giving teeth to clawback rights. There is also the power to checkmate debtors who may seek to employ legal gymnastics and technicalities to frustrate recovery.
Other key pillars include ensuring accelerated 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.
Given the fact that the debt will eventually become the burden of the Federal Government and by extension taxpayers, Balogun reiterated the need for speed in recovery, while all must collaborate to ensure that AMCON recovers the debt as mandated by the new amendments.
It is immoral, he continued further, to allow obligors go without punishment, insisting that no legitimate means adopted by AMCON and its agents to recover the debts as enshrined in the Amended AMCON Act that can be termed as draconian.
The corporation, he stressed, needed the additional powers, urging the management to do whatever it takes, including aggressively pursuing both primary and secondary obligors to ensure recovery.
Balogun argued that it is only debtors that would have issues with the amendments, as those who mean well for the Nigerian economy will rather see the Act as one that has come to enhance AMCON’s debt recovery capability while supporting the enforcement regime.
According to Kuru, although the process of amending the Act was challenging, AMCON is grateful to the National Assembly and President Buhari, for their courage and for putting the issue to rest and accomplishing this feat.