Reps want CBN to investigate banks over bad loans

By Odunewu Segun

The House of Representatives has expressed serious concern over the quality of loans acquired by the Asset Management Corporation of Nigeria (AMCON) from eligible financial institution in the country.

The declaration was made when the House Committee on Banking and Currency led by its Chairman, Jones Onyereri, visited AMCON’s head office in Abuja on Tuesday as part of its oversight functions to review the corporation’s 2016 performance.

Onyereri called on the Central Bank of Nigeria and the Federal Ministry of Finance to immediately ensure that all wrongly declared loans by commercial banks were recovered to enable AMCON cover its funding gap.

He also stated that loans without proper documentation and those which were unrecoverable due to packaging or state of the collateral should be reloaded back to the financial institutions since they were now making profits.

According to the committee chairman, giving contracts to individuals or companies that are heavily indebted to AMCON defeats the whole essence of creating the special agency in the first place.

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Onyereri said, “The committee observed that it will not be desirable for the Federal Government to continue to patronise individuals and companies who are hugely indebted to AMCON, while those companies on the other hand, refuse to repay their debts.

“We are, therefore, calling on the Federal Government to direct the Ministry of Finance to deduct at source the value of debts owed by such debtor companies or individual with expected receivables from the Federal Government. We also suggest that it may be necessary for such debtor companies to obtain clearance from AMCON as a prerequisite for Federal Government patronage in the future.”

In his welcome remarks, the Managing Director/Chief Executive Officer, AMCON, Mr. Ahmed Kuru, informed the committee that for the corporation to survive and meet its obligations, the root causes of some of the loans that ended up with AMCON need to be revisited.

Kuru reiterated the fact that AMCON was dealing with obligors that had the financial capacity to engage it from court to court in their plot to evade repayment and thereby sabotaging the efforts of the Federal Government to