The Asset Management Corporation of Nigeria (AMCON) has said it has so far recovered over N1.8 trillion, stressing that in the year 2022, the corporation made a profit of N58.59 billion.
This was disclosed by the Managing Director/Chief Executive Officer of the corporation, Mr Ahmed Kuru, according to a statement by the Head, Corporate Communications Department, Jude Nwauzor.
Kuru, the statement said, spoke at the first interactive session with members of the 10th Senate Committee on Banking, Insurance and Other Financial Institutions at the New Senate Building, National Assembly Complex.
At the event chaired by the committee’s head, Senator Adetokunbo Abiru, the AMCON boss while providing an overview of the corporation’s activities, said the corporation had remained a profit-making organisation aside from delivering on the recovery mandate for which it was created by the federal government ab-initio.
He added that its activities cover enforcement, asset management, even though AMCON was created as a “bad bank” with various challenges beyond its control.
“AMCON made a profit of N23.97 billion in 2020, which increased to N34.65billion in 2021. In year 2022, the Corporation made N58.59 billion profit.
“The loss captured in the management account as of September 30, 2023 was because interest accrual on the Central Bank of Nigeria (CBN) loan note had been charged as expense to its profit and loss account”
It explained that this was while the corresponding credit, the receipts for external recoveries, which is estimated to about N359 billion was yet to be recognised and captured in the corporation’s balance as at that time.
“This is usually recorded in the last month of the financial year, December, before closing the books. Consequently, the corporation is projected to close with over N70 billion profits by December 2023 once the receipts from the sinking fund is reflected in its profit or loss account accordingly,” it added.
It recalled that the CBN had conducted a special examination of 24 banks as a result of which critical intervention was required at that time.
“It was after that exercise that the AMCON bill passed in June 2010 was signed into law by the President of the Federal Republic of Nigeria on July 19, 2010.
“Since its enactment in 2010, the National Assembly has amended the AMCON Act thrice–in May 2015, July 2019, and November 2021 respectively to strengthen the powers of the corporation to deliver on its tough mandate of debt recovery.
“For the records, AMCON purchased 12,743 NPLs or EBAs worth N3.797 trillion from 22 Eligible Financial Institutions (EFIs) for a purchase price of N1.8 trillion.
“The purchases are covered by various collaterals. The corporation also injected a total sum of N2.2 trillion to 10 Banks – Bridged and Owned Banks (intervened banks) – bringing Net Book Value (NAV) to zero. AMCON capitalised three EFIs and provided financial accommodation to five,” it added.
Explaining the funding model of the corporation, which it said confuses most people, Kuru stated that: “AMCON’s intervention activity was funded by debt obligation of N4.65 trillion (as at 31st December 2018), which is to be repaid, from internal and external sources, to the CBN by 2024.
“It is worth knowing that at conception, it was envisaged that AMCON, being a loss minimisation entity would repay 30 per cent of the obligation, while the balance is expected from external recovery sources as provided in the AMCON Act,” he explained.
Emmanuel Addeh in Abuja
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