Bad loans, also known as bad debts is the amount of loan unlikely to be paid by the borrower as initially agreed between the borrower and the lender.
A report by the Asset Management Corporation of Nigeria (AMCON) says about N4.6 trillion worth of loans in Nigeria remain unresolved and this represents 75% of Nigeria’s budget.
To check out some banks and its officials who facilitated these huge non-performing loans, AMCON says it is collaborating with the Economic and Financial Crimes Commission (EFCC).
It said the decision was for:
- Both agencies to consolidate on the gains in the areas of investigating, prosecuting and compelling all obligors of AMCON to recover N4.6 billion from debtors.
- The agencies are planning to revisit, reinvestigate and duly prosecute such banks and the responsible officials.
- In appropriate circumstances, these bankers would also be called upon to account for their roles in granting these questionable facilities.
In his speech, Ibrahim Magu, EFCC acting chairman, said both agencies had “very tough, overwhelming and challenging” assignments, adding that he was happy that AMCON is doing everything to confront debtors.
- EFCC has established AMCON desk so that AMCON related cases are attended to quickly and assured that the number of personnel on the desk would be increased if need be.
- Some of the people who took loans with no intention of paying back such loans.
- Those obligors who took loans without the intention of paying back did not envisage that someday an agency like AMCON would come knocking on their doors seeking to recover the loans, condemning the impunity with which the transactions were carried out.
Finally, Magu said failure to resolve the debts would have serious implications for the country.
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