- AMCON Struggling to Recover N5.5trn Bad Loans
Asset Management Corporation of Nigeria (AMCON) is still struggling to recover N5.5 trillion or $15 billion bad loans acquired during the financial crisis over a decade ago.
The Chief Executive Officer Ahmed Kuru, AMCON, who was at a conference in Lagos on Wednesday, said delays in litigation are weighing on the organisation’s ability to recover the loans, saying sluggish economic growth is also hurting business ability to pay.
During the 2008-2009 global crisis, AMCOM bailed out 10 banks and acquired more than 12,000 loans from aviation to petrol marketers to manufacturers. But over 10 years later, the asset management company has been unable to recover N5.5 trillion of the loans acquired,
According to Kuru, only N1 trillion has been recovered so far.
“Amcon needs to recover the outstanding debts to enable it to meet obligations to the Central Bank of Nigeria, which provided the cash it used to repay holders of bonds issued to acquire the loans,” Kuru stated.
He, however, explained that extending the recovery process beyond 2023 deadline will do more harm than good as it could fuel bad behavior in the financial sector and encourage other borrowers to do the same.
“The federal government should be appropriating the money yearly,’’ required to meet its obligations should the bad debts are not recovered,” Kuru added.