AMCON laments rising toxic loans profile in Nigeria
Despite engaging professionals to assist it recover bad debts, otherwise known as toxic loans, the management of the Asset Management Corporation of Nigeria (AMCON) has said that there is still increase in the volume of the loans.
It confirmed that it is still retaining over 12,000 of loans now classied as bad debts under its control.
Recall that AMCON had in May 2016 inaugurated a special partners on loan recovery exercise, drawn from private sector outfits from within and abroad.
The body named the Asset Management Partners (AMP), more than 11 months into coming on stage, has less than 20 per cent of the original toxic debts in the process of being recovered, said an insider source in AMCON.
But speaking in Abuja Last week, during a feedback session with the Amps, organised to cross-fertilise ideas on the way forward, Managing Director/Chief Executive Officer, AMCON, Mr. Ahmed Kuru expressed displeasure that most of the partners were performing below standard.
He tasked them to take the assignment seriously as those that performed creditably well were to be retained in the review exercise to follow soon.
But AMCON’s belief that the over 6,000 accounts, with loan balances of N100 million and below, would have been reduced by at least half before May 2017 could not be achieved, going by the returns of performance by the Amp’s consortium.
Kuru reportedly expressed some misgivings that rather than the debt-accounts reducing, from 12,000, as at 2016, it would rather increase with the anticipation that the full financial statements from many companies for the recession period were yet to be received.
AMCON boss said it came up with the ingenious idea of collaborating with AMPs because it became necessary last year, given the fact that the Corporation has a total loan portfolio of various sizes from sectors that are still lingering seven years after AMCON was established.
But one of the senior management staff in an Apapa-based consultancy company, who would not want his name in print put the debate thus: ” AMCON was able to take over management of a number of private outfits, which are into bad debt regime, made possible through the activities of the Amps.
” Most of the bad debts were as old as 10 years and made worst by the dead banks, which offered most of the loans on political considerations “, he stated.