Angered by its less than stellar performance in recovery of banks’ toxic assets after three years in business, Senators yesterday demanded a probe of the N5.6 trillion pumped into the Asset Management Company of Nigeria (AMCON) by the Central Bank of Nigeria (CBN) since inception.
The Senators had lamented that three years after it was set up, AMCON has failed to live up to its objective of recovering toxic debts owed by some commercial banks.
The lawmakers’ discontent against the corporation came to the fore during the consideration of a bill to amend the AMCON Act, which scaled second reading in the Senate yesterday.
The Senate had mandated its Committee on Banking, Insurance and other Financial Institutions chaired by Senator Bassey Otu, to find out the exact amount CBN had pumped into AMCON and how effectively it was used in the execution of its mandate as well as how much it has recovered so far. While insisting that the committee investigates what AMCON had done with the whopping N5.6 trillion, Chairman of the Rules and Business Committee, Senator Ita Enang, said the sum exceeded Nigeria’s yearly budget with the allegation that since the company commenced operations, it has failed to recover up to 15 per cent of the entire money.
He advised the committee to examine the functions and operations of AMCON, adding that it was “disheartening that the organisation appeared to be failing because the amount committed to it by CBN was not free money but a loan meant to be paid to the Federation Account.”
Among others, the bill seeks to establish a corporate entity with a well-constituted Board of Trustees drawn from CBN, eligible financial institutions, Nigeria Deposit Insurance Corporation (NDIC) and Ministry of Finance to make regulations for the supervision and management of AMCON fund. Leading the debate, Senator Otu, said the bill seeks to prohibit any board member or an employee of AMCON from being directly or indirectly involved in the purchase of assets acquired by the corporation.
He also said the amendment bill sought to empower AMCON to acquire assets that are already subject to litigation if there is no valid court order restraining it from doing so.
In his remarks, Senate President, David Mark, noted that if the toxic debt that AMCON was mandated to manage was not yielding any fruitful result and the Federal Government was now asked to subsidise it, those found culpable in the fruitless exercise must be punished. The committee is expected to report back to the Senate in two weeks. It would be recalled that the International Monetary Fund had in two recent reports on Nigeria called for the winding down of AMCON. Also yesterday, the Senate referred the recent appointments of new service chiefs by President Goodluck Jonathan to the Senate Committee on Defence for screening.
The service chiefs are Air Marshal Alex Badeh (Chief of Defence Staff), Major General Kenneth Minimah (Chief of Army Staff), Rear Admiral Usman Jibrin (Chief of Naval Staff) and Air Vice Marshall Adesola Amosun (Chief of Air Staff).