The Nigerian Senate has passed a bill that strengthens the power of the Asset Management Corporation of Nigeria (AMCON) to recover bad loans acquired from commercial banks.
In the new AMCON Amendment Bill, the agency has been empowered to go after bank debtors and take over assets other than the ones used as collateral to recover the debts.
The new measures are part of the amendments to the AMCON bill which was passed by the Senate on Wednesday, April 28, 2021, during the plenary session at the red chamber of the National Assembly in Abuja.
In the approved bill, the lawmakers empowered AMCON to take possession, manage, or sell all properties traced to debtors, whether or not such assets or properties have been used as collateral in obtaining the loans.
The bill also gives the recovery firm the power to take these bad debtors to special credit tribunals to recover debts, thereby eliminating bottlenecks often experienced in the normal regular courts.
The special tribunal was established by the Banking and Other Financial Institutions Act (BOFIA) 2020 to deal with financial-related matters.
The AMCON amendment bill, which was read for the third time on the floor of the Senate, was passed after the lawmakers considered and approved the Report of the Senate Committee on Banking, Insurance, and other Financial Institutions, chaired by Senator Uba Sani.
What you should know about AMCON
- AMCON, which was established on July 19, 2010, was created to be a key stabilizing and re-vitalizing tool aimed at reviving the financial system by efficiently resolving the non-performing loan assets of the banks in the Nigerian economy.
- The agency is struggling to recover about N5.5 trillion ($13.4 billion) debts from borrowers since the 2008-09 banking crisis.