The Nigerian government will stop ‘patronising’ all individuals and companies that owe the Asset Management Corporation of Nigeria (AMCON), Vice President Yemi Osinbajo has said in Abuja.
Also, AMCON puts its total outstanding debts obligations from various corporate and individual obligors at over N5 trillion.
Mr Osinbajo spoke during a meeting with the board and management of AMCON at the State House, Abuja, on Friday.
He said the federal government would “deal decisively with individuals and organisations still indebted to the corporation.”
Mr Osinbajo, who is the Chairman of the Economic Council, accused the affected debtors of “holding the entire nation to ransom with their bad behaviour.”
He told the delegation, led by the board chairman, Muiz Banire, that the debts have made it impossible for AMCON to resolve its outstanding challenges.
According to the vice president, a framework for an inter-agency collaboration is to be established soon.
The framework, he said, would ensure that henceforth institutions and individuals still indebted to AMCON would not be allowed to do business with government ministries, departments and agencies (MDAs).
Mr Osinbajo said the initiative would be supervised by the office.
“The federal government, under President Muhammadu Buhari will no longer fold its hands and allow a few individuals that owe AMCON huge sums of money walk freely on the streets in the country,” the VP said.
“I think the time has come for the government to set some examples with some of these top debtors of AMCON, to serve as a deterrent to others,” he added
He promised that the government will continue to give AMCON whatever support is necessary “for them go after the debtors that have remained recalcitrant despite the olive branch extended to them over the years.”
Having recovered over N1 trillion, both in cash and in assets, since inception to 2018-year-end, he said AMCON deserved more support to recover more, “to help the economy and provide the government with more money to continue developing infrastructure across the country.”
The official said he would soon invite AMCON alongside other relevant MDAs to discuss plans on how to ensure any debtor to AMCON “are completely made to face government as its direct enemies and the people of Nigeria.”
Mr Banire highlighted some of the challenges and frustrations faced by AMCON as a result of the attitude of some debtors “who see themselves as being above the law.”
He urged the government to continue rallying round AMCON to succeed in realising its mandate.
Of the over N1 trillion recovered since inception, Mr Banire said cash accounted for over 60 per cent, while non-cash assets, such as properties and equity securities make up the balance.
As at end of December 2018, he said AMCON’s Assets Under Management (AUM) stood at about N172.5 billion, with total real estate properties, assets available for sale valued at N62 billion.
Of this N62 billion, about 83 per cent, he said, comprised of land and other assets, “which may need considerable improvements to convert into income generating assets.”
In September 2018, he said following the takeover of Skye Bank Plc. by the Central Bank of Nigeria (CBN) and the Nigeria Deposit Insurance Corporation (NDIC), AMCON was again invited to inject about N898.5 billion as capital to facilitate the emergence of another bridged bank, Polaris Bank Limited.
“The intervention in Skye Bank was caused majorly by internal abuses by the operators. As a result, AMCON’s total debt obligation to the CBN is currently in excess of N6 trillion,” he said.
Since the government cannot afford to write off this debt in the short term, he said it was the moral obligation of AMCON to pursue obligors and recover the debts owed.
Despite the successes recorded, he said the corporation was facing several challenges, “including obligors resorting to all manner of tactics to avoid honouring their obligations.”
“Whilst some are still enjoying government patronage, others are using the judiciary and adopting legal technicalities to stall recovery. This is why we need a new strategy to enable AMCON meet its mandate before sunset,” he said.
Meanwhile, the AMCON MD, Mr Kuru, said the agency is looking forward to the take-off of the inter-agency collaboration Mr Osinbajo talked about to compel all sister agencies to work together in the interest of the country.
Mr Kuru also said that failure to recover AMCON’s debts, “currently sitting on the government’s balance sheet with the CBN may result in serious consequences, including recourse to taxpayers’ money.”
According to him, considering the huge debt portfolio, “the government should not allow any obligor go scot-free, no matter how highly placed (they are) in the society.”
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