After approaching the National Assembly for inclusion in the provisions of the amended Banks and Other Financial Institutions Act (BOFIA) 2020, The Asset Management Corporation of Nigeria (AMCON) is seeking the establishment of special tribunals to try those owing it N5.4 trillion.
BOFIA 2020 allows set up of special tribunals for hearing financial matters emanating from financial institutions.
AMCON’s Managing Director/Chief Executive Officer Ahmed Kuru disclosed this on Wednesday, during his presentation before the Senate Committee on Banking, Insurance and other Financial Institutions at the National Assembly, Abuja.
Ahmed Kuru said the proposed amendment, among others, will be critical to AMCON’s expected deliverables as it would quickly enable the corporation to resolve the debts.
He noted that by the following introduction of new sections, the corporation is seeking to be accommodated by the provisions of the newly amended BOFIA (2020), which sets up special tribunals for hearing financial matters emanating from financial institutions.
The designation of a special tribunal for financial cases immediately assumes the achievement of quicker resolution of matters as judges are designated to hear only such financial matters.
“Moreover, BOFIA prescribes a maximum period of six months to conclude matters brought before the Tribunal. AMCON being accommodated under this Tribunal will assist AMCON with its speed of recovery.
The Senate Committee chaired by Senator Uba Sani (Kaduna State) invited AMCON top executives and other key stakeholders agencies of the Federal Government, including the Central Bank of Nigeria (CBN), the Ministry of Finance and the Nigeria Deposit Insurance Corporation (NDIC) for a continued engagement regarding the amendment of the AMCON Act No.3 (Amendment Bill) 2021 with the Senate Committee on banking insurance & other financial institutions. The bill was originally sponsored by Senator Opeyemi Bamidele (Ekiti State).
Kuru explained that to enable AMCON succeed in its national call to duty, “it is soliciting the continued support of the Senate Committee on Banking, Insurance & Other Financial Institutions with the proposed amendments for adoption.”
According to him, “AMCON Act encourages asset tracing for accounts for the gap, plus contributions from the financial institutions including the CBN”.
Kuru Added that: “as at today, the contributors have not been able to meet the expected yearly amounts, which is mainly due to the fact that the assumptions have not materialised.
AMCON had purchased 12,743 bad loans worth N3.8 trillion from 22 Eligible Financial Institutions (EFIs) for a purchase price of N1.8 trillion. The purchased are covered by various collaterals. Of this number, AMCON has so far resolved about 4,000 Eligible Bank Assets while more than 8,000 EBAs are still outstanding. AMCON has also mapped out about 6,000 accounts for the Asset Management Partners (AMPs.)
The corporation had to inject a total sum of N2.2 trillion to 10 Nigerian banks – bridged and owned banks (intervened banks) – bringing Net Book Value (NAV) to Zero.
The corporation recently took over Skye Bank (now Polaris) under the bridged bank concept of the CBN and NDIC. The bank had stabilised and operating efficiently.
“Therefore, the only remedy is to provide an inbuilt legal mechanism whereby they continue to contribute in addition to recoveries until the whole debt is paid, otherwise the obligation falls on taxpayers.”
AMCON boss, who attended the senate engagement with other top officials of AMCON, listed the areas requiring National Assembly intervention to include: the Cessation of the Resolution Cost Fund/defined tenure; dissolution date of the Corporation, recovery through special tribunal for enforcement and recovery of eligible loans as well as certificate of Sale of Certificate of Transfer as a valid registrable instrument for AMCON.