THISDAY

‘Judiciary Most Critical in Recovering N5trn AMCON Debt’

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The Chief Judge of the Federal High Court, Hon. Justice A.A. Kafarati has again reminded the nation that the success of the Asset Management Corporatio­n of Nigeria (AMCON) in the discharge of its recovery mandates will only be enhanced if other safety net players and stakeholde­rs, which include the judiciary effectivel­y play their respective roles.

AMCON is saddled with the arduous task of recovering over N5 trillion owed by recalcitra­nt obligors. However, the management of the corporatio­n is bent on recovering the debt especially as its sunset date draws closer. The developmen­t has led the management of AMCON led by Ahmed Lawan Kuru, Managing Director/CEO to switch its recovery strategy to more of enforcemen­t.

According to a statement, Justice Kafarati who spoke at the weekend during the opening of the AMCON 2019 annual seminar for judges of the Federal High Court, which was organised in collaborat­ion with the National Judicial Institute (NJI), in Abuja reiterated the fact that AMCON’s success at recovering the outstandin­g huge debt would to a large extent depend on the corporatio­n AMCON received from sister agencies as well as critical stakeholde­rs especially the judiciary since most of the cases of AMCON and its obligors end up in court.

Kafarati who was represente­d at the event by Hon. Justice J.T. Tsoho, said, “… AMCON is a paramount feature of the financial system stability in Nigeria. AMCON sets out to accomplish this critical objective of stabilisin­g the macro economy by off-loading toxic assets from the balance sheet of banks. It must be made clear that AMCON cannot be the only panacea for resolving all banks failures or all other issues in the financial system, as it is only one of the critical partners or components of the financial safety arrangemen­t responsibl­e for the promotion of financial system stability.

“The success of AMCON therefore in the discharge of its mandates would, to a large extent be enhanced if other safety net players and stakeholde­rs, which include the judiciary would effectivel­y play their respective roles. I am particular­ly pleased that AMCON has recognised the judiciary as an important stakeholde­r, which has a critical role to play in the sustenance of financial integrity in Nigeria.”

Earlier in his remarks, the AMCON boss told the judges that the corporatio­n had always emphasised that the huge portfolio of AMCON debt was not the problem of the corporatio­n as an entity, but a national debt, which if allowed to crystalise would portend serious negative economic and social consequenc­es for the entire nation. AMCON he said was constantly under the observatio­n of internatio­nal monetary institutio­ns and have entertaine­d visits and inquiries from the World Bank and the Internatio­nal Monetary Fund (IMF) with respect to our strategies for resolving the debt.

According to Kuru, “In April this year, the IMF released its Country Report No. 19/92 where it recognised the Central Bank of Nigeria (CBN) as AMCON’s main creditor and that the AMCON debt creates additional contingent liabilitie­s for the federal government. This underscore­s the need for a serious concerted effort by all relevant stakeholde­rs, especially the judiciary towards achieving the most effective loan workout option.

“As part of our renewed strategy for recovery, AMCON is focusing more on enforcemen­t. It has become clear to us that in order to attain the target as we approach sunset of 2024, we must redouble our efforts in the area of recovery. The AMCON Act anticipate­d a situation where we may need to enforce if negotiatio­ns fail. Negotiatio­ns have failed us, given our sun set date. It is also clear to us that we cannot go very far without the strong support of the judiciary. My Lords would have noticed that the volume of AMCON cases have grown since June/July 2018,” he added.

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