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AMCON recoups over N800 billion from Debtors

By on October 15, 2012

 

The Asset Management Corporation of Nigeria (AMCON) has recovered over N800 billion from blacklisted debtors, which analysts believe would go a long way to assure stability to the banking industry.

 

The AMCON MD, Mustapha Chike-Obi, disclosed this during the week, adding that, Net Oil and Cross River State Government have also redeemed their debt commitment to AMCON, “Net Oil and Cross River State Government are no longer direct obligor to AMCON,” he said.

 

Reacting to the situation, a Lagos-based financial analyst, Mr. Bode Olatunde, said, CBN should be highly praised for its bravery to publish the debtors’ list, which contains names of influential persons that were close to the corridor of power as well as some state governments.

 

“The truth is that the CBN’s list has shown that we are all equal before the law. Nobody had thought the apex bank could crack down on some of those businesspersons whose names featured on the list. I believe that for once, the culture of impunity is destroyed in the business circle and this will go a long way in reminding prospective borrowers from the banks that they must certainly account for whatever facility they draw from the banks.”
“I also believe that this development will impact positively on banks’ finances now that everybody knows that the days of free loans are over.”

 

“This shows that the CBN does not have any sacred cow and all it is saying is that people should honour their obligations,” Olatunde said.

 

Olatunde advised banks to be aware of predator borrowers who use the same collateral to collect loans from different banks, adding that, the release of the debtors list by the CBN should alert banks on who not to lend to.
He added that, the funds AMCON used to buy off the debts are taxpayers’ money, which should be treated as such.

 

A member of the Financial Market Dealers Association of Nigeria, who pleaded anonymity, said the policy of exposing debtors will sanitise the industry, banks would no longer give away credits without security, and debtors would uphold their end of the bargain. He also called on the judiciary to urgently deal with cases taken to court by some debtors to delay payment of their debts.

 

Equally, some bank shareholders have lauded the CBN for its decision to expose the debtors.

 

President Renaissance Shareholders Association, Mr. Olufemi Timothy, said, “It is a very good development. A situation where someone owes and you give that person some concession and still he is not willing to pay, I think the best thing to do is to stop that person from getting further credit.”

 

“The decision by the central bank is commendable and we must all support the CBN. The policy should be fully implemented and should not be politicised.”

 

Likewise, President, Nigeria Shareholders Solidarity Association (NSSA), Chief Timothy Adesiyan, said he would rather refer to the blacklisting move as an antidote to the situation, which was persistent.

 

The apex bank and AMCON were said to have since reconciled their lists, which will allow more debtors to payoff. However, the said debt settlement by Otedola is generating a lot of argument recently, and House of Representative has set a committee to investigate the controversial deal between Otedola and AMCON.