The Senate has taken a swipe at the Ahmed Kuru-led management of the Assets Management Corporation of Nigeria (AMCON) over the N145 billion loss recorded by the agency within 12 months, describing the development as gravely concerning.

The Red Chamber also frowned on the agency’s poor financial performance since inception and its failure to recover N5 trillion in liabilities. The lawmakers therefore resolved that since the Agency had failed woefully in its responsibilities, the right thing to do, was to scrap it.

Kuru, AMCON’s Managing Director (MD), who led top management of the Agency to the Senate to present its 2023 financial records as well as defend the 2024 budget estimates, revealed that only a paltry N648 billion had been recovered out of the total liabilities as of September 20, 2023.

The visibly angry lawmakers noted that AMCON, an agency, saddled with the statutory responsibility amongst others, of recovering the non-performing loans, disbursed by banks to their customers, has not been aggressive enough in its loan recovery duties.

ArmadaNews had last year, published an investigative report, alleging that top management of AMCON receive between 10 and 20 percent of the amount paid by buyer of seized assets, who are mainly their cronies.

Sources familiar with the agency’s operations, told ArmadaNews that the team at AMCON, allegedly negotiate with buyers of seized assets, including original owners, on how much the agency would get for selling the assets to them at reduced prices.

It was gathered that for selling the properties to the buyers at prices lower than their actual value, the buyers in turn, compensate the AMCON team by paying them a certain percentage depending on the actual value of the assets and how much paid.

Kuru was arrested in January 2022 by the anti-graft agency, the Economic and Financial Crimes Commission (EFCC) for alleged assets diversion and selling of seized assets to cronies at below value prices by businessmen accused of loan default with banks.

Irked by the huge liabilities incured by the agency and its failure to recover the huge N5trillion debt, the Senate said it has to thinker in doing away with AMCON, noting that it has outgrown its usefulness.

Sani Musa, the chairman of the Senate Committee on Banking, Insurance, and Other Financial Institutions, expressed dissatisfaction that AMCON was gulping annual budgetary allocations and doing nothing.

The committee therefore demanded the dissolution of the agency, citing poor financial performance and its failure to recover N5 trillion in liabilities.

Musa stated that it is not enough to defend the budget but it is also important to see the effect of Appropriation, pointing out issues with loans owed by individual companies and the subsequent repurchase of assets.

The Senator questioned whether it was more prudent to maintain AMCON or consider its dissolution given its deviation from its statutory mandate.

He declared: “Most of the loans were owed by individual companies that were never sanctioned, and at the end of the day, the same company would go back to buy back their assets that AMCON had hitherto taken over. Are we going to continue like this?

“It is not only about defending the budget; it is about seeing the effect of the Appropriation; we need to know whether it is working. Or are we just creating a job for those we can’t protect? Will it not be better to scrap AMCON since it seems to have lost its statutory mandate?”.

Another member of the panel, Senator Jimoh Ibrahim, expressed concern over the discrepancies in AMCON’s balance sheet and huge losses suffered by the agency in the 2023 fiscal year alone, which was put at N145 billion.

“Your total comprehensive profit and loss and came into a loss of N145bn. This calls for concern. Your net operating profit and loss is N126bn. What is responsible for all these big losses? You are created to collect bank loans from them”, Ibrahim said.

“Even if you’re now regulators to the debtors, why are you incurring losses? Your balance sheet is not looking so good. Again, why are you buying cash-collateralised loans?” he queried.

AMCON has recovered only a paltry N648 billion out of the huge N5trillion debt.

Analysts opined that the agency is not doing enough in its loan recovery duties but instead blames its woes on other agencies of the government.

Despite the poor performance of the agency, President Muhammadu Buhari in December 2020, renewed the appointment of Kuru and also reappointed Mr. Eberechukwu Uneze and Mr. Aminu Ismail as executive directors of the corporation for a final term of five years. Their reappointment was confirmed in February 2021 by the Senate.

However, analysts have expressed concerns about the abysmal performances by AMCON and the Nigerian Deposit Insurance Corporation (NDIC), the two institutions carrying out similar functions, and urged the government to either scrap one or merge the two and appoint a more competent person at the helm.

A former Director-General of the Nigerian Stock Exchange (NSE) Prof. Ndi Okereke-Onyiuke had in 2016, called on the federal government to merge the two agencies, pointing out that sustaining both institutions is wasteful as they have similar mandates.

Besides she said the government was gradually killing the banking industry as AMCON and the NDIC are being funded by banks using depositors’ funds.

She said: “AMCON and the NDIC are taking so much money from the banks. Depositors are getting less returns on their deposits as a result of this. Keeping both institutions is a waste of time, money and human resources. They should be merged and made to work.”