The Senate, on Tuesday, considered a critical bill seeking to empower the Asset Management Corporation of Nigeria (AMCON) in the aspect of assets recovery, as well as strengthen it against economic sabotage by debtors with unpaid loans to the tune of about N16 trillion.
The Asset Management Corporation of Nigeria (AMCON) Amendment Bill 2021, which scaled second reading on the floor was sponsored by Senator Michael Opeyemi Bamidele (APC, Ekiti Central).
Leading debate on the bill, Bamidele said, “the main aim of this amendment is to update a few clauses in the Act that have been hampering the Operations of the Asset Management Corporation of Nigeria.”
According to the lawmaker, “under the current Act, the continued smooth operation of AMCON is threatened by the tenor put on a key funding provision for AMCON.”
“Therefore, the proposed amendment is designed to allow for more flexibility in the tenor of this key funding provision,” he added.
Bamidele emphasized further that the amendment would strengthen AMCON in stabilizing Nigeria’s banking sector and empower the agency in carrying out its functions of assets and debt recovery.
He said, “Mr. President, Distinguished Colleagues, AMCON is a very important and strategic national institution that must be strengthened to effectively contribute to the stabilization of the banking sector in Nigeria.
“It proved its mettle in the banking crises of 2009. Our economy still grapples with huge challenges. The banking sector is not immune from the difficulties we face. We must therefore review and amend the AMCON Act (2014) in order to reinvent and reposition AMCON to optimally perform its functions.
“In particular, this amendment will strengthen the hands of AMCON in assets recovery. AMCON must be reenergized to tackle the problem of toxic loans.
“Highly placed debtors have been employing different strategies and tactics to stall the repayment of loans. Cases drag on in courts for many years. AMCON has remained at the receiving end of this well laid and orchestrated acts of economic sabotage.
“Mr. President, Distinguished Colleagues, as patriots we have an obligation to empower AMCON and make its assets recovery efforts less cumbersome. We must remove all obstacles to its smooth operations. We must safeguard our banking sector and the economy in these trying times.”
Contributing, Senator Uba Sani (APC, Kaduna Central) emphasized that, “AMCON largely depend on the resources from the resolution fund, and failure to extend this amendment bill will certainly affect the operation of AMCON and it may force the government to bear the entire cost of debt management of AMCON.”
On his part, Senator Adamu Aliero (APC, Kebbi Central), said the amendment “will give teeth to AMCON to recover all debts that were given to private individuals and also companies.”
“Mr. President, I don’t know whether my colleagues are aware of the information circulating in social media and even in the conventional media, where only twenty individuals have taken about N7.5 trillion naira.
“Mr. President, this is more than what we spend as capital budget of this country, and these individuals are well to do individuals and they are walking on our streets.
“They have huge sums of money, some of them have even transferred these monies abroad. There’s nothing toxic about it, the money is with them, they have used it and they don’t want to pay.
“They are using all tactics to ensure that they block the investigation agencies like EFCC from recovering the loan. They have even gone to court to get all kinds of injunctions stopping AMCON from recovering the loan.
“Mr. President, we should all support this amendment, it will make Nigeria to be sanitized financially, and banks would even be in a better position to give loans to people bearing in mind that there must be collateral for giving such loans.
“They were a little bit careless in the past, but with this, Mr. President, if this amendment passes through, it will be a wake-up call for all financial institutions in the country to do what is right and proper,” Aliero said.
Yusuf Abubakar Yusuf (APC, Taraba Central) underscored the need for extending the tenor of AMCON, adding that doing so would rescue Nigeria’s financial and banking systems from the burden of loans obtained by individuals.
The lawmaker also called on the Judiciary to work with the intendment of the amendment bill by ensuring that debtors face the weight of the law and are made to pay all loans.
His words: “We have no option but to extend the tenure of AMCON because AMCON is carrying a contingent liability that which is sovereign to the tune of nearly N6 trillion naira.
“Loans that were private in the past have now been made a sovereign loan, so we are all carrying this as a result of past errors of commission done by the banking system.
“Mr. President, Sir, this bill to extend the tenor has come at the right place, otherwise, we may not be able to recover the same of nearly N6 trillion naira, and I don’t know what would have happened to this financial system or the banking system.
“Finally, while we are extending this tenor, we hope and pray that the Judiciary will work in tandem with the aspiration of the bill to assist and make sure that individuals that are carrying these liabilities, certainly are called to book and are made to pay so that our sovereign will be relived off this burden.”
Another lawmaker, Senator Bala Ibn Na’Allah (APC, Kebbi South) called for an insertion of a criminal clause in the amendment bill that makes it possible for debtors to be detained by the courts, and the payment of half the total amount owed made a mandatory condition for granting them bail.
Na’Allah said: “It is not sufficient enough to extend the tenor of AMCON and give it the power to reinvent and reposition itself so that it can optimally perform.
“If the desire is to recover these loans, we may have to go back to introduce a criminal element into this recovery process.
“So, when we introduce the criminal element into this matter, what it means is that the 16 trillion that we are taking about, we will get more than N8 trillion immediately, because this money is with them.
“They are just using the Judicial process to frustrate the recovery these monies. When it comes to the committee level, one of the inventions that this Senate can do, is to insert a criminal element into it that gives court the power to detain and refuse bail until half of the amount owed is paid as a condition for granting bail.
“Once we do this, it will be a radical departure from all these misuse of court process to hang on to what does not belong to you. And, I think that this one of the nest decisions this senate can take as far as this matter is concerned.
“It is even more so, because the banking sector will continue to do this as long as a decisive action is not taken this misuse.”
The Senate President, Ahmad Lawan, referred the bill after it scaled second reading to the Committee on Banking, Insurance and other Financial Institutions for further legislative work.
The Committee which is Chaired by Senator Uba Sani was given four weeks to turn in its report.