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Reps reject CBN’s payment of N50bn to AMCON

By on October 25, 2014

The House of Representatives on Thursday rejected a proposal requiring the Central Bank of Nigeria to pay N50bn yearly into the Resolution Cost Fund.

The Fund was created by the Asset Management Corporation of Nigeria Act to bail out distressed banks and other financial institutions.

The new proposal was contained in an amendment bill to the AMCON Act, 2010.

But the lawmakers rejected the proposal for yearly payment and instead retained the mode of payment prescribed in the Principal Act.

In the extant law, the CBN is empowered to pay the N50bn “from time to time” as determined by the Board of the apex bank.

Members had considered the report on the amendment on Thursday, which was submitted by the House Committee on Banking/Currency.

The only sections approved were 2,16(5), 22(2), 34(1)-(2), 35, 46(2), 48, 57, 60 and 62 of the AMCON Act, 2010.

Section 61(2), which contained the new proposal, was rejected by members.

Two lawmakers from Rivers State: Mr. Sekonte Davies, and Mr. Honourable Osita, led the opposition to the amendment.

They argued that allowing such huge sum to be paid into the ‘sinking fund’ yearly would result in corruption.

Davies said, “There is no provision showing how the money will be recovered. Are we saying that the Federal Government has become Father Christmas? We are creating room for massive corruption.”

However, the Chairman of the House Committee on Banking and Currency, Mr. Jones Onyereri, opted to withdraw the amendment pending more legislative inputs.

The N50bn is equivalent to 0.3 per cent of the total asset of the CBN.

Only recently, it was made public that the bank deducted N111bn from its revenue as payment to AMCON.

 

[Punch]