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Asset Management Corporation of Nigeria (AMCON), in a bid to rejig its asset sales strategy and facilitate speedy disposals, has restructured its processes from within in anticipation of better outcomes in its asset resolution operations.
This is coming as the agency recorded total recoveries of N731 billion (excluding claw backs). From inception in 2010 to December 2017, out of this amount, properties accounted for approximately 35 per cent.
On the flip side, the corporation noticed an increasing decline in its ability to dispose of assets at competitive market rates due to the several factors including inflation among other market dynamics.
Managing Director/Chief Executive Officer of AMCON, Mr. Ahmed Kuru made the disclosure while declaring open a 2-day Asset Sales Strategy Retreat, which just ended in Abuja.
Kuru, who was represented at the opening by Mr. Aminu Ismail, the Executive Director in charge of Operations stated that part of the strategy was to expand the scope of its sales strategy by engaging professionals from the real estate sector including legal experts and regulatory stakeholders and cross-fertilise ideas on better measures to follow to enable AMCON dispose its huge assets at good value and in good time in line with AMCON mandate.
“As you may be aware, one of the key objectives of AMCON is—to obtain the best achievable financial returns for all assets acquired. Following the acquisition of Eligible Bank Assets (EBAs), AMCON is now saddled with the responsibility for recovering the bad loans either through cash repayments or asset forfeitures/foreclosures. In fact, the bulk of recoveries, which have been recorded at AMCON are in form of asset recoveries. Considering the fact that AMCON’s obligations to the Central Bank Nigeria (CBN) is in the form of cash repayment, AMCON therefore has the responsibility of converting the assets into cash in order to meet the repayment obligations,” he said.
With such indices, Kuru again said, “At AMCON, we have realized that we cannot continue to do business as usual – it has therefore become imperative for us to seek more innovative ways of converting our huge portfolio of assets into liquid cash as quickly as possible. We have convened some of the most resourceful real estate professionals and legal experts to this forum to help brainstorm through the issues and proffer practical solutions to the challenges confronting AMCON. We also invited critical regulatory stakeholders to contribute to the discourse toward finding workable solutions.”
Also speaking at the retreat, Dr. Eberechukwu Uneze, Executive Director in charge of Asset Management at AMCON, who also chaired the plenary session stated that there was dire need to have professionals, experts and agencies collaborate with AMCON because the Corporation has a stockpile of assets, which it is finding difficult to dispose in the regular open market.
These assets, he said, cut across critical sectors of the economy such as real estate, energy, transportation and aviation, maritime, agriculture and manufacturing just to mention a few, all of which he said must be disposed as quickly as possible against all odds the agency is challenged with.
The retreat featured high-powered presentations and contributions including Appraisal of Methods of Valuation Considering Achievable Market Value by Victor Adekunle Alonge, Board member, and Chairman, Professional Practice Committee (PPC), Estate Surveyors & Valuers Registration Board of Nigeria; Strategies for Conducting Successful Marketing Campaign and Attracting Buyers for AMCON Assets by Mr. Aigbekan Osas; Value Optimization Strategies for AMCON Assets, which was jointly presented by Obi Mkparu, a real estate investment consultant and Akingbade Tunji of Akingbade & Associates.
Other presentations include Creating a market for AMCON Assets, delivered by Chinwe Ajene-Sagna of Strategic Reality; Legal Documentation Impediments on the Sale of AMCON Assets by Albert Nwanozie; Challenges Experienced in the Sale of AMCON Assets by Olamipo Macaulay. There were also contributions from Mr. Chuka Agbo SAN, Managing Partner, Lexavier Partners; High Chief Isaac Folorunsho; Lanre Shittu, a Deputy Director with the Central Bank of Nigeria; Mulikat Balogun, Registrar of Titles, Lagos State and Ibrahim Bamidele, Director of Land Services, Lagos State; Aliyu Abubakar Kalgo, AMCON Head of Asset Sales and a host of others.
AMCON was established in 2010 as a resolution vehicle to purchase the non-performing loans from banks, inject liquidity into the banks and subsequently recover the purchased bad loans.
Over the last eight years of existence, it has successfully stabilised the Nigerian banking sector by restructuring and collecting some of these loans. What is outstanding on its portfolio at the moment are hardcore debts, which the corporation said is doing everything within its powers to settle as quickly as possible.