The Managing Director of the Asset Management Corporation of Nigeria, AMCON, Mr. Ahmed Kuru, has said that the poor economy has continued to be an impediment on their performance.
Speaking at a press briefing with journalists over the weekend in Lagos, Kuru said that his corporation had had to battle with an avalanche of failing and defaulting companies thus making debt recovery difficult.
He said that most of the restructured businesses with huge injection of funds have had a performance level of below 10 per cent
“If the economy is doing very well, some of those businesses that are defaulting will also be doing very well. If the economy is not doing very well, then those underlying businesses would also not be doing very well,” Kuru explained.
“So, if you gauge what we have done against what is obtainable internationally, you will see we are doing better, adding that the corporation, though, not a profit- oriented organisation, have managed to reduce substantially its’ excess loss position, noting that for AMCON to be performing, the economy must also be growing.
He said that the corporation has decided to keep a substantial amount of real estate assets, with the hope of selling it later when the economy picks up, adding that selling now will amount to a loss. “If we dispose them now, we might not be able to recover the value,” he said.
Commenting on loan recovery, Mr. Kuru said that the corporation was working with the legislative arm of government to see how they can amend the AMCON Act, in order to aid their activities.
He stressed the need for his corporation to work faster as they were nearing the end of their mandate which expires in 2023.
“That is why we are putting a lot of efforts on our Asset Management Partners. We have less than 350 obligors that account for more than 80 per cent of our outstanding liabilities.
AMCON recovered a total amount of N740 billion from debt as at the end of 2017, according to its 2017 results, while recording a loss position reduced significantly by 90 per cent to N16.41billion in the same year, compared with N164.94billion in the previous year.
AMCON’s financial statement also showed that its gross earnings grew by 22.6 per cent, to N342 billion in the year under review, from N279 billion, just as its total assets reduced to N822 billion in 2017, from N1.131 trillion. The corporation’s interest revenue increased by 21 per cent to N42.56 billion, while its net trading gain surged to N22.86 billion.