Business
AMCON set to recover N4.5tn debt
Debt running into the sum of 4.5tn has been targeted for recovery by the Asset Management Corporation of Nigeria, (AMCON).
The Managing Director, AMCON, Mr Ahmed Kuru, said this at the weekend in Abuja at the investiture of governing council/induction of members of the Chartered Institute of Loans and Risk Management of Nigeria.
He also expressed worry over the rising cases of non-performing loans in the banking sector.
Kuru said the development, if left unchecked, could result in the creation of more toxic assets in the banking sector as was the case in 2010.
He put the amount of debt owed AMCON at about N4.5tn, stating that everything was being done to recover the debt.
The AMCON boss said the N4.5tn was so huge that it could be written off, adding that it was about half of the Federal Government’s annual budget.
He added that the N4.5tn owed by chronic debtors was higher than the annual budget of countries such as Rwanda and Kenya.
Speaking on the impact of the intervention of AMCON, Kuru said that when the corporation took over the toxic assets of the banking sector, the NPLs in banks were very high.
He said through aggressive recovery efforts, the NPLs came down to less than five per cent.
However, he lamented that while the corporation was busy recovering bad loans, banks were busy granting loans without putting in place proper risk assessment criteria.
This, according to him, has shot up the banking sector’s NPLs to about 15 per cent.
He said, “The institute is doing a good job. We commend the leadership for the dynamism you have brought into this.
“A lot of professionalism and integrity is needed from you. The Asset Management Corporation is taking over bad debts because of risk management failure in loan management.”
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