Urges Judges To Support Enforcement Regime
Ahead of its 2024 sunset date, the Asset Management Corporation of Nigeria (AMCON), at the weekend in Abuja urged the judiciary to help recover its outstanding N5tr debt.
Speaking at the Federal High Court Complex, Abuja during the opening of the AMCON 2019 annual seminar for Judges of the Federal High Court, in collaboration with the National Judicial Institute (NJI), the Managing Director/Chief Executive, Ahmed Kuru, lamented that negotiation with debtors has so far failed the corporation.
As part of its renewed strategy for recovery, he said AMCON is focusing more on enforcement, even as It has become clear “that in order to attain the target as we approach the sunset of 2024, we must redouble our efforts in the area of recovery.
“The AMCON Act anticipated a situation where we may need to enforce if negotiations fail. Negotiations have failed us, given our sunset date. It is also clear to us that we cannot go very far without the strong support of the judiciary.”
Experience with the traditional litigation system and a sign of the failure of negotiation as a resolution option, he noted, is the noticeable growth in the volume of AMCON cases since June/July 2018. As a result, he said it has become imperative “to consider other dispute resolution mechanisms, giving the slow pace of litigation, obligors’ propensity to hide under technicalities, and AMCON’s sunset timeline,” he added.
Kuru emphasized that the huge portfolio of AMCON debt is a national headache, rather than being that of the corporation alone as an entity, which is why it must not be allowed to crystalize with serious negative economic and social consequences for the entire country.
AMCON he said is constantly under the observation of the international monetary institutions and have hosted visiting officials of the World Bank and the International Monetary Fund (IMF) with respect to strategies for resolving the over N5tr or $14bn debt in its portfolio. He assured that the corporation would not want the debt to become a drain on the nation’s treasury.
According to Kuru, “In April this year, the IMF released its Country Report No. 19/92 where it recognized the Central Bank of Nigeria (CBN) as AMCON’s main creditor and that the AMCON debt creates additional contingent liabilities for the federal government. This underscores the need for a serious concerted effort by all relevant stakeholders, especially the judiciary towards achieving the most effective loan workout option.
Also speaking at the seminar with the theme: “The Dynamic and Proactive Deployment of AMCON Special Powers and Alternative Dispute Resolution (ADR) in the Effective and Efficient Resolution of Troubled Assets, Chief Judge of the Federal High Court, Justice Adamu Abdul Kafarati recalled that the success of AMCON in its recovery mandates is only possible if other stakeholders, including the judiciary, effectively play their roles.
This, he noted, is by stakeholders, especially the judiciary, and sister agencies cooperating with AMCON given that most cases between AMCON and its obligors end up in court.
Kafarati who was represented at the event by Justice John Tsoho, noted that “…AMCON is a paramount feature of the financial system stability in Nigeria. AMCON sets out to accomplish this critical objective of stabilising the macroeconomy by off-loading toxic assets from the balance sheet of banks. It must be made clear that AMCON cannot be the only panacea for resolving all bank failures or all other issues in the financial system, as it is only one of the critical partners or components of the financial safety arrangement responsible for the promotion of financial system stability.
“The success of AMCON therefore in the discharge of its mandates would, to a large extent be enhanced if other safety net players and stakeholders, which include the judiciary would effectively play their respective roles. I am particularly pleased that AMCON has recognised the judiciary as an important stakeholder, which has a critical role to play in the sustenance of financial integrity in Nigeria.”
He reminded the participants of the need for the Federal High Court to do more in support of AMCON’s recovery drive since courts have the unique constitutional responsibility and exclusive jurisdiction in respect of all AMCON matters.
“We are therefore integral and certainly indispensable to the holistic implementation, realisation, and accomplishment of the AMCON mandates as provided in the AMCON enabling Act,” he stressed.
Photo caption: From left, Justice John T. Tsoho, representative of the Chief Judge of the Federal High Court speaking at the seminar; Ahmed Lawan Kuru, MD/CEO of the Asset Management Corporation of Nigeria (AMCON); and Justice Ijeoma L. Ojukwu, at the weekend in Abuja.
