Only about 10 to 15 of the 113 bad debtors (companies) that the Central Bank of Nigeria (CBN) barred from further borrowings from banks two years ago have been able to repay their loans taken over by the Asset Management Corporation of Nigeria (AMCON).
The low recovery rate by AMCON translates to 87 per cent of loan defaulters, two years on, who have not been able to meet their loan obligations, THISDAY has learnt.
Their inability to pay their loans, THISDAY gathered, stemmed from the CBN directive, which has hampered their capacity to refinance and restructure loans, thus worsening their situation.
Sources close to the central bank told THISDAY that though the concept of blacklisting debtors, who have defaulted on their loans is standard practice in the banking industry, the strategy on implementation has failed to yield the desired result of making the debtors pay.
Instead, the directive has forced most of the companies to exist on a hand-to-mouth basis and totter along, but have been unable to pay back the debts to AMCON.
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