AMCON recovers N759bn debt, seizes N264bn properties

The Asset Management Corporation of Nigeria has recovered a total of N759bn from debtors.

Some of the debtors also forfeited their properties worth N263.73bn, a new report released by the Central Bank of Nigeria said.

AMCON was established by the Federal Government in 2010 to buy bad debts from banks and ensure stability in the financial sector.

It made cash recoveries of N89.97bn for the 2018 financial year from asset sales and credit repayments, bringing its total recoveries from inception to N759.05bn as of December 2018.

According to the report, the recoveries consist of cash, N366.85bn; shares forfeiture, N128.47bn; and property forfeiture, N263.73bn.

The apex bank said the carrying value of AMCON’s liabilities increased from N4.53tn at the end of June 2018 to N5.43tn as of December 2018, arising from the corporation’s investment of N898.45bn in Polaris Bank Ltd.

Following the declining health of the now defunct Skye Bank Plc, the CBN revoked its operating licence in September last year and created a bridge bank, Polaris, to take over its assets and liabilities.

It said the strategy was for AMCON to capitalise the bridge bank and begin the process of sourcing investors to buy out the corporation.

According to the CBN, the carrying value of AMCON assets, net of impairment, increased from N731.55bn at the end of June 2018 to N769.87bn as of December 2018.

It said, “AMCON’s N5.43tn liabilities were projected to be covered by the Banking Sector Resolution Cost Trust Fund and the corporation’s internal credit recoveries and asset sales.

“Contributions to the BSRCTF by the CBN and 15 participating banks for 2018 were valued at N228.28bn. The recoveries generated by AMCON as well as the contributions to the BSRCTF were used to repay the corporation’s debt obligations, which fell due in December 2018.”

The CBN noted that there was an improvement in banks’ non-performing loans ratio from 12.45 per cent at the end of June 2018 to 11.67 per cent at the end of December 2018.

 

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