Business
Doubts over AMCON’s ability to recover N1.9 trillion debt
…as agency struggles to recover N2.1 trillion in 15 years
Fifteen years after its establishment, the Asset Management Corporation of Nigeria (AMCON) continues to face significant challenges in recovering the remaining N1.9 trillion in outstanding debt.
The corporation has only been able to recover N2.1 trillion since its inception, raising concerns about its ability to meet its mandate before its sunset period.
A major stumbling block is the over 2,000 pending court cases tied to debt recovery efforts. Many debtors have allegedly diverted funds meant for business investments, making it even harder for AMCON to recover these obligations. Analysts argue that legal delays and debtor resistance could prevent the agency from achieving its objectives before it winds down operations.
Further complicating the situation are allegations of fraud involving former AMCON executive directors. Reports suggest that financial mismanagement within the corporation has contributed to its slow recovery rate. Industry experts warn that such accusations could undermine AMCON’s credibility, making it harder to enforce compliance and recover funds from debtors.
Stakeholders are calling for urgent reforms to strengthen AMCON’s enforcement mechanisms, improve transparency, and accelerate legal proceedings. Without decisive action, there are growing fears that a significant portion of the N1.9 trillion debt may remain uncollected, ultimately impacting Nigeria’s financial sector and economy.
AMCON Vows to Recover N227.6 Billion from Arik Air
However, speaking at a press conference in Lagos, AMCON’s Head of Corporate Communications, Mr. Jude Nwauzor, reaffirmed the agency’s commitment to recovering the N227.6 billion owed by Arik Air Limited (in Receivership) and its founder, Sir Johnson Arumemi-Ikhide.
Nwauzor accused some debtors of manipulating the media to misrepresent AMCON’s efforts, urging journalists to remain objective.
“These individuals have significantly impacted Nigeria’s economy. The media must not allow them to distort the facts,” he said.
He listed Arik Air, Rockson Engineering, Ojemai Farms, and Ojemai Investment Limited as major debtors, with a combined debt of N455.17 billion as of December 31, 2024.
Arik Air’s Financial Woes
Nwauzor dismissed Arumemi-Ikhide’s claims that Arik never defaulted on its loans, challenging him to provide evidence of repayment.
“If the loan was performing, why was it sold and restructured? Why did he agree to the restructuring? Did he fulfill the agreed terms?” Nwauzor questioned.
AMCON revealed that Arik’s debt originated from loans acquired from Union Bank, Bank PHB (now Keystone Bank), and others. By 2010, Union Bank classified the loan as non-performing and transferred it to AMCON after warning Arik about its deteriorating financial health.
By 2016, Arik had a negative equity value of N80 billion and total liabilities of N289 billion. By December 2016, the airline’s negative shareholder capital had ballooned to N139 billion—almost equaling its debt to AMCON.
Government Intervention and AMCON’s Takeover
In 2017, AMCON took over Arik Air, citing mismanagement, massive flight cancellations, unpaid staff salaries, and regulatory violations. The airline was on the brink of collapse, unable to sustain operations.
Between November 2016 and January 2017, Arik failed to pay for insurance and owed N30 billion to aviation regulators, including the NCAA, FAAN, and NAMA. Concerned about safety risks and the fate of over 1,500 employees, the government urged AMCON to step in.
In 2021, Arumemi-Ikhide challenged AMCON’s receivership in court, but Justice A. Lewis-Allagoa upheld AMCON’s authority, affirming the takeover’s legitimacy.
Despite this ruling, Arumemi-Ikhide continues to dispute the debt, accusing AMCON of mismanaging Arik’s fleet. However, AMCON countered, revealing that only eight of Arik’s aircraft were operational at the time of takeover, refuting claims of a 30-plane fleet.
The Cost to Taxpayers
AMCON, established in 2010 to stabilize Nigeria’s banking sector, has struggled against debtors exploiting legal loopholes to evade repayment.
“If AMCON cannot recover these debts, the burden falls on taxpayers. The general public will pay for the recklessness of a few individuals,” Nwauzor warned.
He urged the media and public to hold debtors accountable, assuring that AMCON remains determined to recover all outstanding obligations, including those of Arik Air and its affiliates.
