Article
By Alex C
The Asset Management Corp. of Nigeria, set up by the West African nation to buy bad debts from banks, is set to repay $4.9 billion (N800 billion)of bonds expected to be due in August 2014. This development leaves N3.8 trillion of remaining debt after N1 trillion was redeemed last year.
Nigeria, Africa’s largest economy, established AMCON in 2010 to buy bad debt from banks and save the industry from collapse as lenders reeled when loans to stock speculators and fuel importers soured after the global financial crisis in 2008.
The agency spent N5.6 trillion in 2011 to acquire non-performing loans and took over three of the eight banks it rescued with a N620 billion bailout. Two of the lenders it took over-Mainstreet Bank Ltd. and Enterprise Bank Ltd-is expected to handover to new owners by September 15, 2014.
AMCON’s divestment in Keystone Bank will start once done with the other two companies. Interestingly, the Agency does not see the possibility of buying new non-performing loans till it winds up by 2022 as the banks are now stronger.
Image: https://media.premiumtimesng.com