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House probes AMCON’s N2.4trn unpaid debts

The House of Representatives Thursday mandated its Committee on Banking and Currency to investigate the non-liquidation of N2.473 trillion owed the Assets Management Corporation of Nigeria (AMCON).

The Committee, which is to fully investigate the failure of “obligors” and debtors to liquidate their loans is to report back to the House in four weeks. The mandate was subsequent upon the adoption of a motion raised under Matters of Urgent Public Importance calling for an “investigation of AMCON “obligors” and debtors over the non-liquidation of N2,473,084,522.73”, sponsored by Johnbull Shekarau.

It would be recalled that AMCON was established by the Federal Government in response to the 2007-2009 financial crisis. Government, through the Central Bank of Nigeria (CBN), provided the initial capital and a three-year zero coupon guaranteed bond to allow the corporation raise N5.67 trillion for interventions.

Shekarau in his argument observed that six years after, AMCON is yet to recover the debt owed it in order to redeem the three-year zero coupon bond it acquired.

According to the lawmaker, only 20 individuals can be linked to a large chunk of the debt owed AMCON, hence the need for the House to take definitive action to compel as well as assist the company to liquidate debts owed it.

Corroborating Shekarau, Hassan Saleh, maintained that the dishonesty of a few individuals has negatively affected millions of other Nigerians currently struggling to survive the economic recession.

He identified top operators in the aviation and the oil and gas sectors as dominating the list of chronic debtors, wondering how they lived lavish lifestyles while their debts weakened the nation’s economy.

According to him, “We cannot continue to pay their bills, while they live the life of the rich and favoured,” he argued.   House Minority  Leader, Leo Ogor, called for a thorough investigation into the matter, adding that many of the debtors have carried on with living luxuriously, not caring about the damage they are causing others.

“They fly around in their private jets, while the common man is suffering on the streets. These people sit down in the comfort of their bedrooms, while the nation bears the pain of their debts and this unacceptable,” he said.

The report indicates that the current N5 trillion debt portfolio of the corporation is N4.2 trillion higher than the alleged N800 billion ceiling stipulated for it by the CBN, according to the report. The report also showed that the corporation’s balance sheet has a shortfall of N3.8 trillion ($19 billion) and that the geometric accumulation of debts by AMCON puts immense pressure on the country’s foreign reserves estimated at $30 billion.

The report read in part: “In addition, the outstanding bad loans owed to AMCON by different companies and individuals (acquired from banks) as at December 31, 2014 stood at N3.403 trillion, which also has the potential of becoming outright losses.”