Business giants in trouble over N5 trillion AMCON debts
Institutions and individuals on Asset Management Corporation of Nigeria’s (AMCON’s) debtors’ list are to be blacklisted. They will no longer be allowed to do business with the government henceforth, it was learnt at the weekend.
According to a plan by the Federal Government, an inter-agency collaboration framework that comprises Ministries, Departments and Agencies (MDAs) and supervised by the office of the Vice President, will block the indebted entities from dealing with the government, which is the biggest player in the economy.
Vice President Yemi Osinbajo, who doubles as the Chairman of the National Economic Council (NEC), dropped the hint, when he hosted some members of the AMCON Board led by its Chairman, Muiz Banire at the State House, Abuja.
Prof Osinbajo said the debtors made it impossible for the corporation to resolve its outstanding N5 trillion debts, thereby holding the entire nation to ransom with their “bad behaviour”.
There are 105 debtors on the AMCON list. They include key players in aviation, power, real estate, oil and gas, as well as other sectors of the economy.
AMCON has recovered over N1 trillion since inception in 2011. Of the recovered funds, cash assets account for 60 per cent and non-cash assets, such as properties and equity securities, account for the balance of 40 per cent. Over the same period, AMCON’s repayment of its indebtedness to the CBN was over N1 trillion.
The vice president plans to invite the AMCON team alongside other MDAs to fine-tune how to ensure that anybody or agency that is a debtor to AMCON faces the wrath of the Federal Government as those who are indebted to the government are direct enemies of both the government and the people.
He said the Federal Government under the leadership of President Muhammadu Buhari will no longer allow a few individuals who owe AMCON huge sums of money walk freely on the streets. Osinbajo said: “I think the time has come for us (Federal Government) to set some examples with some of these top debtors of AMCON, which I believe will set a good example and serve as deterrent to others.”
Osinbajo, who expressed satisfaction with the performance of the executive management of AMCON under Ahmed Kuru’s watch, promised that the government would support AMCON.
He said that the Corporation would be empowered with the tools to go after the obligors who have remained recalcitrant despite the olive branch extended to them over the years by the debt recovery agency.
Osinbajo said: “I congratulate AMCON for the work done so far having recovered over N1 trillion and counting both in cash and in assets. The work you do as a recovery agency is not something that is particularly easy or encouraging because we all know how Nigeria works. But we are committed to working more closely with your administration to ensure that these monies are recovered from AMCON obligors because it will help our economy and provide the government with more money to continue to improve on the development of infrastructure across the nation.”
Banire said AMCON’s visit was to congratulate President Muhammadu Buhari and Vice President on their victory at the polls. He highlighted some of the challenges faced by AMCON as a result of the attitudes of some debtors who behave as if they are above the law.
Banire said: “As at end of December, 2018, AMCON’s Assets Under Management (AUM) amounted to about N172.5 billion.
“It is noteworthy to state that out of the total real estate properties, assets available for sale are valued at N62 billion. Of this N62 billion, about 83 per cent comprises bare land and other assets, which may need considerable improvement to convert into income generating assets.
“Your Excellency may recall that in September 2018, following the takeover of Skye Bank Plc. by the Central Bank of Nigeria (CBN) and the Nigeria Deposit Insurance Corporation (NDIC), AMCON was again invited to inject a total sum of N898.45 billion as capital, thereby leading to the emergence of another bridged bank named Polaris Bank Limited.
“The intervention in Skye Bank was caused majorly by internal abuse by the operators. As a result of that development, AMCON’s total debt obligation to the CBN is currently in excess of N6 trillion.
“And it is evident that the Federal Government cannot afford to write off this debt in the short term, hence, our moral obligation to pursue obligors and recover the debts owed. But, despite the successes recorded, the corporation has been facing a number of challenges, which include obligors resorting to all manner of tactics to avoid honouring their obligations.
“Whilst some are still enjoying government patronage, others are using the judiciary and adopting legal technicalities to stall recovery, which is why we need a new strategy to enable AMCON meet its mandate before sunset.”
Kuru said he could not wait for the take-off of the inter-agency collaboration promised by Osinbajo as, according to him, such a move would compel all sister agencies to be on the same page in the interest of the country.
The AMCON boss also reminded the vice president that AMCON’s debts sits on the government’s balance sheet with CBN, and failure to recover them may result in serious consequences including recourse to tax payers’ money, which must be avoided.
“He said for an organisation like AMCON with sunset date, all hands must be on deck to provide the support required. According to him, considering the huge portfolio of debt, no obligor must be allowed to go scot free – no matter how highly placed in the society.