AMCON admits recovery of ₦134 billion from debtors
As a result of the new aggressive recovery strategies adopted by the Asset Management Corporation of Nigeria, it was able to recover ₦134bn from various debtors in the 2016 financial year.
The Managing Director/Chief Executive Officer, AMCON, Mr. Ahmed Kuru, stated this in Lagos on Friday at press briefing to explain the agency’s performance for last year.
However, Kuru said the corporation had an outstanding obligation of ₦5.7tn to pay to the Central Bank of Nigeria.
While giving a breakdown of the recoveries, he said ₦86.9bn was from cash collections, while ₦30.64bn was realised from forfeiture of assets by AMCON debtors.
A further ₦7.9bn was realised from sale of properties of debtors, while ₦8.7bn came in from the sale of shares.
He added that loan recovery could have been higher in 2016 but for the recession that hit the country and other challenges in the economy, which had seriously affected businesses.
Kuru also listed other obstacles to loan recovery to include the refusal of some obligors to pay back, numerous court cases that take many years to resolve, and difficulties in disposing seized assets.
“They are quite a lot of challenges we are facing in debt recovery; we are not under any illusion that it is easy to recover bad loans. Loan recovery is a very unpleasant job,” he added.
The Chief Financial Officer, AMCON, Mr. Olugbenga Ataiyero, said the corporation was servicing the ₦5.7tn CBN loans with six per cent interest.
As a result, he stated that ₦268bn was charged to the agency’s profit and loss account as interest expenses in the 2016 fiscal year.
Ataiyero stated that AMCON made a loss of ₦251bn in 2016 compared to ₦310bn in 2015, adding that the interest payment on the ₦5.7tn CBN loan was largely responsible for the loss, while its loss-making subsidiaries added to the burden.
In order to reduce the losses, he said the corporation was making efforts to divest from some of the subsidiaries.
The CFO explained that the corporation’s mandate was not to make profit but to reconstruct non-performing loans so as to help businesses.
He said that the corporation had envisaged that banks would have contributed ₦288bn into the AMCON Sinking Fund in 2016 from their balance sheets, but were only able to contribute ₦136bn, due to the economic crunch in the country.
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