Nigerian Newspapers

N1.7trn investment under threat as IMF recommends closure of AMCON

Published

13 years ago

April 1, 2013

By AMECHI OGBONNA and CHINENYE ANUFORO

Nigeria’s estimated N1.7 trillion investment in the operations of the Assets Management Corporation (AMCON) may go down the drain if the Federal Government accepts the recommendation of the International Monetary Fund (IMF), calling for its immediate closure.

The advice was part of IMF’s Executive Board assessment and recommendation to the Goodluck Jonathan administration, after the conclusion of its 2012 Article IV consultation with Nigeria. The directors had commended Nigerian authorities’ success in restoring financial stability, after the 2009 banking crisis, but subsequently recommended the winding down of the operations of the Asset Management Company.

According to Investor Advocate, an on-line medium, the IMF, in the report last week, advised the Nigerian government to wind down the operations of AMCON, in order to curb its moral hazards and associated fiscal risks. The advice to the Nigerian authorities may not be unconnected with the corporation’s widely reported operational loss of a whopping N2.37 trillion ($ 15 billion) for the 2011 financial year, an indication that the scale of financial devastation left by a 2009 banking crisis was deeper than many had originally thought. However, reacting to the suggestion, Managing Director of AMCON, Mr Mustapher Chike Obi, said the corporation has been talking with IMF, but at no time had the issue of its closure been mentioned, adding that if such an idea was to be contemplated, his board would be adequately briefed by the Bretton Woods institution.

But commenting on the IMF advice, Dr Oladimeji Alo, managing partner, Excel Professional Services and financial analyst, wondered why the IMF suggestion would be coming at this time that AMCON was beginning to handle some serious business of cleaning the financial system of the rot that hit it.

The former chief executive of the Financial Institution Training Centre further state that the setting up of an asset management company was a global trend that was not peculiar to Nigeria, stressing that the suggestion to wind up AMCON makes no sense considering the situation Nigeria found herself in 2009 with the banking crisis. He said it was too late in a day to make such recommendation since the European state of Cyprus was currently contemplating setting up a bad bank to manage its financial crisis.

Alo admitted that the issue of moral hazard has always been there but that the option was one of the best available for the country then to overcome a debilitating crisis that nearly rocked the country’s financial system. He advised that AMCON should be allowed to operate at least for five years so that Nigerians would be able to assess its performance critically. AMCON had acquired liabilities of rescued and other financial institutions in the country estimated at over N4.3 trillion at a discounted value of N1.7 trillion with the hope of recovering part of the risk assets to remain in business.

Its managing director had, while briefing the media on the direction it intends to go to achieve the objectives of setting it up, stated he would appoint professional debt recovery agents, while complementing that with the efforts of the government security apparatus to secure commitment of some high profile debtors to the affected banks. In collaboration with the CBN the names of some high profile debtors were actually published in several national dailies as part of last ditch effort to make them honour their obligations.

But while some had come forward to pay back their debts, AMCON is still facing an uphill task recovering a significant portion of the debt owed raising worries the government may have embarked on another profligate venture. AMCON’s surprisingly large loss has raised questions about how it will refinance a N1.7 trillion naira zero-coupon bond at the end of 2013, a development that may also have serious implications for Nigeria’s national budget.

The after-tax loss – which AMCON officials revealed at a news conference – comes in the first accounts to be published by the bad bank since it was set up in 2010 to absorb the debts of banks hamstrung in a crisis caused by over exposure to a weak oil and local stock market in 2008–09. The crisis almost sank about 10 banks but for the timely intervention of the Central Bank with a $ 4 billion bail-out fund to keep them afloat.

The loss was a “wake-up call” that the banking sector’s problems will not be resolved as easily as first thought and that banks may end up paying a higher contribution towards its resolution, said Razia Khan, head of Africa research at Standard Chartered Bank. “The non-performing loans that we bought were four times larger … which shows you that what was disclosed as NPLs (non-performing loans) on the books of the banks were (below) what we found when they started selling to us,” said AMCON Executive Director of Finance, Mofoluke Dosumu. “We bought four times what we initially envisaged.”

Analysts questioned how AMCON’s losses would impact its ability to repay a total of N4.5 trillion government-backed bonds used to clean up the banking sector if the value of the assets it hold continued to erode and whether the sinking fund will be sufficient in the short-term.

The IMF also welcomed the central bank’s commitment to address supervisory and regulatory gaps identified in the Financial Stability Assessment Update, particularly the need to strengthen cross-border supervision and the regime against money laundering and terrorism financing.

As part of the Nigeria’s Central Bank’s effort at combating money laundering and financing of terrorism, it issued an exposure draft of Know-Your-Customer (KYC) requirements to cover low-value and low-risk accounts, thereby promoting and deepening Financial Inclusion while ensuring compliance with Anti-Money Laundering and Financing of Terrorism (AML/CFT).

To check the above, the CBN also developed AML/CFT RBS Template for Statutory Returns by Financial Institutions under its regulatory purview and the Nigerian Financial Intelligence Unit (NFIU) to ensure uniform rendition of Reports. The CBN also developed in conjunction with Chief Compliance Officers of Banks (CCCOBIN), Standard Account opening forms for reporting Institutions to improve KYC compliance.

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This Day

Military, Police Ring Abuja to Forestall Boko Haram Attack

Published

5 years ago

May 1, 2021

•Deploy more personnel as army chief vows to wipe out terror group
•Security beefed up at N’Assembly

Deji Elumoye and Kingsley Nwezeh in Abuja

Abuja, Nigeria’s seat of power, is under a massive security cordon following threats of attacks by insurgents and the increasing wave of banditry in the contiguous states of Kaduna, Kogi, Nasarawa and Niger States, THISDAY’s investigation has revealed.

There has been a wave of kidnappings in the outskirts of the federal capital, notably Pegi, Tuganmaje and Kuje among others, which the police have battled in recent times.

The security situation in and around the Federal Capital Territory (FCT) was heightened by the pronouncement of the Niger State Governor, Mr. Sani Bello, that Boko Haram fighters who he said sacked 50 villages in the state and hoisted the terror group’s flag, were about two hours drive away from the FCT.

Security has also been beefed up at the National Assembly as operatives, yesterday, thoroughly screened every vehicle approaching the National Assembly complex in Abuja.

The deteriorating security situation nationwide prompted the National Chairman of the Peoples Democratic Party (PDP), Prince Uche Secondus, to warn that the 2023 general election may not hold, demanding the declaration of a state of emergency as well as the convocation of a national conference.
However, the Chief of Army Staff, Lt. Gen. Ibrahim Attahiru, yesterday restated the Nigerian Army’s determination to annihilate Boko Haram.

But the Governor of Katsina State, Hon. Bello Masari, cautioned against declaring a state of emergency, saying doing so isn’t the solution to combat the security challenges facing the country.
The security of the nation’s airports was also in focus yesterday as the Office of the National Security Adviser (ONSA) said there was no threat to them.

THISDAY’s investigations showed increased presence of troops, police, Nigerian Security and Civil Defence Corps (NSCDC) personnel and intelligence operatives at the three strategic entrances to the city notably, Keffi, Zuba and Gwagwalada.

More checkpoints were also mounted around Gwagwalada and Keffi.
THISDAY also observed increased intelligence deployment at the entrance and the borders of FCT with contiguous states.

Beyond the borders, there were more deployments and police patrols inside the city and increased intelligence deployments as well.
Security sources told THISDAY: “There are deployments here and there but they are routine. Alertness is key to a secure environment.”

It was also learnt that security agencies were involved in frenzied meetings throughout yesterday.
The meetings, coordinated by the office of the Chief of Defence Staff under the new joint operational strategy of the armed forces, were aimed at coordinating a joint response to possible threats of attack to the FCT.

“I understand the security teams have been meeting for some days now and if you look around you, you will notice that there are increasing patrols and numbers of security personnel. The threats are not been taken lightly,” a source said.

National Assembly workers, lawmakers and visitors also had a harrowing experience accessing the legislative complex due to heightened security in the area.
Security operatives thoroughly screened every vehicle approaching the National Assembly complex in Abuja, impeding both human and vehicular traffic.

The Sergeant-at-arm of the National Assembly and other security agencies supervised the operations, leading to huge traffic build-up inside the complex.

Legislative staff, visitors and lawmakers were seen patiently waiting for their cars to be searched so that they could go ahead with the business of the day.
Some staff and visitors at some point got tired of waiting and were seen alighting from their cars to trek from the gate to the complex.

Meanwhile, the ONSA has said there is no threat to the nation’s airports.
A statement by the Head of Strategic Communication, Mr. Zachari Usman, said the reports of threats to the airports were an internal correspondence of security threat assessment misconstrued as security threat to the airports.

PDP Demands State of Emergency

In a related development, the PDP National Chairman, Prince Uche Secondus, yesterday demanded the declaration of a state of emergency, warning that the 2023 general election might not hold if the federal government failed to tackle insecurity.

He called on the federal government to summon a national conference to address the spike in insecurity.
Secondus added that the national caucus of the party will meet today to discuss the state of the nation.

Addressing members of the National Executive Committee (NEC) in Abuja, Secondus said: “We are worried Abuja is not even safe. It is no longer politics. We got alert of plots to bomb and burn down our airports.

“We urge the federal government to declare a national state of emergency in security. There is the need to call a national conference to discuss the insecurity in the country.

“There may not be any election in 2023 in Nigeria due to insecurity. This government must listen to the people. The Buhari government should call a national confab to discuss security and state of the nation. It is no longer politics. This time we are not playing politics. Let’s keep politics aside and move the nation forward.”
He said the country had been grounded, regretting that there had been no matching response from the federal government.

Secondus said in the past, terrorism in the North was confined to the North-east, but with the report of Boko Haram occupying villages in Niger State, terrorism had spread to the North-central
“Herdsmen are also menacing in the West; gunmen causing havoc in the East; and the militants in the South; all killing, looting, raping, maiming and burning down homes. The situation is bad; Nigerians all over are living in fear,” he said.

The Senate Minority Leader, Senator Enyinnaya Abaribe, said the problem of Nigeria was outside of the PDP headquarters, while pledging the support of the Senate to the declaration of state of emergency in security.

Abaribe said he deliberately decided not to speak on the floor of the Senate but to allow the APC senators to speak so as to avoid being accused of giving a partisan colouration to the issue of insecurity.

He stated that only electoral reforms would give victory to the opposition party in the 2023 general election and ensure a democratic defeat of the APC-led federal government.
Also, the Minority Leader of the House of Representatives, Hon. Ndudi Elumelu, commended the NEC and the PDP leadership for their collective efforts at resolving the House leadership crisis.

The NEC meeting adopted the position of Secondus, calling on the federal government to convoke a national conference to discuss the state of insecurity in the country, according to a communiqué read by the National Publicity Secretary, Mr. Kola Ologbondiyan.

Army Chief Vows to Wipe Out Boko Haram

The army yesterday reiterated its commitment to wipe out Boko Haram.
Chief of Army Staff (COAS), Lt. Gen. Ibrahim Attahiru, told reporters in Maiduguri, Borno State that Boko Haram had been defeated in many encounters and would continue to be defeated until it’s annihilated from Nigeria.

“We will take on Boko Haram decisively, and we are committed to the focus of the operations, which is the total annihilation of Boko Haram from Nigeria,” he said.

The COAS, who was visiting the headquarters of Operation Lafiya Dole in Maiduguri for the fifth time since his appointment four months ago, said the visit was to boost the morale of the troops, reassure them and listen to any issues affecting them.

Earlier, the Theatre Commander of Operation Lafiya Dole, Maj. Gen. Farouq Yahaya, lauded the visit, which he said had continued to boost the morale of the troops.
“We are honoured, we are grateful, we are encouraged by those visits. You provided us guidance, logistics and other things we required. We are most grateful for those visits,” Yahaya said.

State of Emergency Won’t Solve Security Challenges, Says Masari

Katsina State Governor, Hon. Aminu Masari, has, however, said declaration of a state of emergency won’t solve the security challenges facing the nation.
Masari, who spoke yesterday with journalists after meeting with the Chief of Staff to the President, Prof. Ibrahim Gambari at the State House, Abuja stated that he was against the recent call by the House of Representatives for the declaration of a state of emergency in the security sector as it would not solve the problem.
According to him, declaring a state of emergency will not achieve the desired effect as the security structure and personnel to be used to execute the emergency are already overstretched in a bid to safeguard lives and property.

Sourced From: THISDAYLIVE

Tribune

Nigeria records 55 new COVID-19 infections, total now 165,110

Published

5 years ago

May 1, 2021

Tribune Online
Nigeria records 55 new COVID-19 infections, total now 165,110

The Nigeria Centre for Disease Control (NCDC) has recorded 62 new cases of COVID-19, bringing the total number of infections in the country to 165,110. The NCDC disclosed this on its official Twitter handle on Friday. “55 new cases of #COVID19Nigeria; Lagos-21, Yobe-19, Ogun-6, Akwa Ibom-3, Kaduna-2, Plateau-2, FCT-1, Rivers-1.” YOU SHOULD NOT MISS THESE HEADLINES FROM NIGERIAN TRIBUNE COVID-19: Nigeria Recorded […]

Nigeria records 55 new COVID-19 infections, total now 165,110
Tribune Online

Sourced From: Tribune Online

Premium Times

Insecurity: Lagos bans occupation of abandoned buildings

Published

5 years ago

May 1, 2021

The government said that no worker should stay back beyond 6:00 p.m. within premises of buildings undergoing construction.

The post Insecurity: Lagos bans occupation of abandoned buildings appeared first on Premium Times Nigeria.

Sourced From: Premium Times Nigeria

The Nation

UFC: Usman gets N584m after beating Masvidal

Published

5 years ago

May 1, 2021

Kamaru Usman has raked in a mammoth £1.1million, about N584.2 million after his impressive knockout victory over Jorge Masvidal on Saturday night, Sportivation.com.ng reports.

The Nigerian Nightmare has been handsomely rewarded for his stunning performance and he was the best-paid fighter on the card which was witnessed by 15, 000 fans in Florida.

According to Daily Mail, Usman earned £538,000 to show up, £459,000 pay-per-view bonus, a £43,000 sponsorship bonus and a well deserved £35,000 Performance of the Night bonus.

Jorge Masvidal also earned £358,000 to show, £186,000 in pay-per-view money and a £28,000 sponsorship bonus.

This is the biggest payday of Usman’s career so far and the Welterweight champion also benefited from the fact that Masvidal is also a top draw for the fans.

Kamaru Usman is a Nigerian-American professional mixed martial artist, former freestyle wrestler and graduated folkstyle wrestler.

Sourced From: Latest Nigeria News, Nigerian Newspapers, Politics

Nigeria Newspapers, Entertainment & News Updates. DisNaija.Com

N1.7trn investment under threat as IMF recommends closure of AMCON

Nigerian Newspapers

N1.7trn investment under threat as IMF recommends closure of AMCON