THE 2016 financial statement of Asset Management Corporation of Nigeria, AMCON, showed that it reduced its loss position from N304 billion in 2015 to N254.34 billion in 2016. But due to the loss suffered from AMCON subsidiaries, the group’s total loss increased to N352.15 billion from N295.45 billion in 2015.

According to AMCON, its efficiency in loss reduction came from the net gain on financial assets designated at fair value through profit and loss of N17,339 million in 2016 and N10,176 million in 2015. AMCON made a gain of N27.15 billion on fair value of its unrestructured loan.

As at December 2016, the interest income of the debt recovery agency stood at N35,281 million compared to N97,244 million in December 2015. The interest expense in December 2016 is N268,769 million while in 2015, it stood at N261,285 million.

The companies interest income reduced due to the change in recognition of interest which is now based on recoverable amount coupled with reduction in loan performance due to 2016 economic recession. Also interest expense is accrued on the balance of N4.028 trillion loan due to the Central bank of Nigeria at 6 percent per annum.

Its credit loss expense in 2016 is N31,681 million while that of 2015 is N69,060 million. AMCON credit loss reduced by about N37 billion between 2015 and 2016.

Its fair value loss/gain on investment is N116 million in 2016 compared to N20,360 million in 2015, while fair value loss on propriety properties reduced from N20.26 billion to mere N116 million

The financial statement showed that AMCON was able to manage its other operating expense downward by almost N8 billion from its several cost saving measures. Its operating income in 2016 was N27,509 million compared to N13,157 million in 2015. Other operating cost increased by N14 billion whereas operating expenses in 2016 is N15,805 million compared to N20,308 million.

Ahmed Kuru, managing director of AMCON, along with key staff of the company presented the company’s financials to journalists on May 26, in Lagos. He said that AMCON used N1.7 trillion to purchase assets worth N3.3trillion while there are N2.2 trillion financial accommodation not backed by assets.

“We are caught up with a balance sheet in excess of N5trillion with obligors not willing to pay. For the past 5 or 6years we have engaged obligors to tell us how they want to pay their debt,” he said, adding that AMCON had to confiscate the assets of those who are not willing to pay their debt.

“If you see AMCON taking over any business, it is because all actions to get the debtor pay have failed,” he said, adding that AMCON had invested N300 billion to revive businesses even though some of them were dead on arrival.

“It is not a pleasant thing for us. You have people who are willing to pay but could not because of the economic situation. But there are those who are not willing to pay,” he lamented.

—  May 29, 2017 @ 12:30 GMT