{"id":66731,"date":"2022-11-18T18:40:15","date_gmt":"2022-11-18T17:40:15","guid":{"rendered":"https:\/\/nationalwire.com.ng\/?p=66731"},"modified":"2022-11-18T19:53:57","modified_gmt":"2022-11-18T18:53:57","slug":"amcon-has-outlived-its-usefulness-12-years-after-existence-isan","status":"publish","type":"post","link":"https:\/\/nationalwire.com.ng\/sub\/amcon-has-outlived-its-usefulness-12-years-after-existence-isan\/","title":{"rendered":"AMCON Has Outlived Its Usefulness 12 Years After Existence\u2014ISAN"},"content":{"rendered":"

\u2026Continued Operation Hinders Returns On Investments<\/p>\n

\u2026 Incapacitate Banks To Adequately Intervene In Real Sector<\/p>\n

Shareholders in the domestic economy have frowned at the continued operations of the Asset Management Company of Nigeria (AMCON), saying its existence 12 years after in the financial sector has brought untold hardship to investors as well as incapacitating most financial institutions contributing to the growth of the real sector.<\/p>\n

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Chike-Obi<\/figcaption><\/figure>\n

The shareholders said, AMCON whose establishment was a kind of a breather in the banking sector between 2008 and 2009 following the threats of the non performing loans or bad debts to the economy has since become an albatross to growth and development of the Money Deposit Banks, owning to the fact that, rather than abate, non performing loans has again increased by 150 percent.<\/p>\n

Addressing the press on Friday in Lagos, Sir Sunny Nwosu, Coordinator Emeritus of the Independent Shareholders Association of Nigerian (ISAN) further remarked that AMCON\u2019s sustained depressed returns on investment and Central Bank of Nigeria faulty interpretation of insider Credits in Banks has since become a threat to investment drive in the country.<\/p>\n

According to him, \u201cThe Asset Management Corporation of Nigeria (AMCON) was established in 2010 by the Federal Government through the Central Bank of Nigeria (CBN) to take over the non-performing loans (NPLs) in the banking sector. Although the establishment of the corporation was received by shareholders with mixed feelings, the agency\u2019s mandate of safeguarding the banking sector, equally settled in fast with the corporation\u2019s warehousing of more than N5 trillion bad loans and injection of fresh funds into the banking sector.\u201d<\/p>\n

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\u201cHowever, about 12 years after the establishment of AMCON, our fears and concerns have emerged as the corporation has today demonstrated its inability to successfully put the debt recovery issue to rest. Specifically, our disappointment stemmed from the fact that the federal government\u2019s debt recovery agency, recovered only a paltry N1.4 trillion since its inception.\u00a0 On the other hand, available data showed that non-performing loans across the financial sector has again increased by more than 150 percent.<\/p>\n

He explained that at the commencement of its operations, the agency purchased 12,743 non-performing loans or eligible bank assets (EBAs) valued at N3.8 trillion from 22 eligible financial institutions (EFIs) for N1.8 trillion, equally earned about N327.6 billion from 0.5 per cent charges on banks\u2019 total assets on and off-balance sheet items imposed on nine banks between 2020 and 2021.<\/p>\n

\u201cAMCON\u2019s levies on commercial banks increased from N146.9 billion in 2020 to N180.67 billion in 2021. As part of the quick intervention in the banking sector bad debts, by CBN through AMCON, the debt recovery agency equally received N125.9 billion from 12 commercial banks listed on the Nigerian Exchange as part of the Sector\u2019sresolution funds in the first quarter of 2022.<\/p>\n

\u201cIn the same period AMCON bank charges increased by 29.5 per cent from N97.18 billion paid in the corresponding period of 2021 to N125.9 billion in the first quarter of 2022.<\/p>

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Advertisement<\/div>\r\n\t\t\t\t\t\t\t<\/a>\r\n \r\n\t\t\t\t\t\t\t<\/div>\n

Sir Nwosu, who queried AMCON\u2019s operations in the financial system, noted that \u201cNigerian shareholders have come to the conclusion that the funding of AMCON with levies from commercial banks\u2019 cannot be continued because of its negative impact on returns on investment and the incapacitation of commercial banks to adequately intervene in the nation\u2019s real sector.<\/p>\n

\u201cThe fundamental of our argument is premised on the fact that AMCON was not set up by the banks, but by the Federal Government, which must take responsibility for its operations.<\/p>\n

\u201cWe are troubled as a corporate entity and as individual investors\u2019 because Nigerians normally run to government for cover but now government through the instrumentality of policy, as in AMCON levies on banks are robbing the banks and shareholders.<\/p>\n

\u201cIndeed most commercial banks and numerous corporate concerns indebted to AMCON currently struggle to remain afloat in the face of numerous litigations as the corporation appears unlikely to meet its set goals. Our conclusion is that the corporation is on the verge of losing the Nigerian tax payers\u2019 money spent in repurchasing critical toxic assets from troubled banks and other entities.<\/p>\n

\u201cAs concerned domestic investors, our patriotism is not in doubt as we demand once again the complete review of AMCON to determine its relevance to the economy or totally abrogate the agency following the declining values of companies taken over by the corporation and the current national economic challenges.<\/p>\n

\u201cWe make bold to say that the lack of due diligence on the troubled banks bad debts, the appalling board and management of the agency are majorly the reasons behind AMCON inability to turn around the toxic assets.<\/p>\n

\u201cAs we speak, AMCON is currently reported to have about N1.7 trillion worth of assets under litigation across the country. As at August 2022, the total recoveries so far by the corporation are pegged at about N1.4 trillion.<\/p>\n

Sir Nwosu said, the need for the government to take a second look at the setting up of AMCON arises from the point of view that, 12 years after the agency operations 350 businessmen and firms still owe the corporation N3.6 trillion, or 81 percent of N4.4 trillion of the total outstanding debts.<\/p>\n

Photo Caption:<\/strong><\/p>\n

From Left —Prof. Victor Segun Akinsete, Barr. Osato Aideyan, Legal adviser (ISAN); Sir. Sunny Nwosu, Coordinator Emeritus, Independent Shareholders Association of Nigeria (ISAN), and Dr. Anthony Omojola, National Coordinator (ISAN) at the association briefing on Friday.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Shareholders in the domestic economy have frowned at the continued operations of the Asset Management Company of Nigeria (AMCON), saying its existence 12 years after in the financial sector has brought untold hardship to investors as well as incapacitating most financial institutions contributing to the growth of the real sector.<\/p>\n","protected":false},"author":6,"featured_media":14525,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[23,17],"tags":[1277,9275],"coauthors":[2391],"class_list":["post-66731","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-business","category-news","tag-amcon","tag-isan"],"yoast_head":"\nAMCON Has Outlived Its Usefulness 12 Years After Existence\u2014ISAN - National Wire<\/title>\n<meta name=\"description\" content=\"Shareholders in the domestic economy have frowned at the continued operations of the Asset Management Company of Nig\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/nationalwire.com.ng\/sub\/amcon-has-outlived-its-usefulness-12-years-after-existence-isan\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"AMCON Has Outlived Its Usefulness 12 Years After Existence\u2014ISAN - 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