The Asset Management Corporation of Nigeria (AMCON) has reported a decline of N437 billion in its total assets for the 2023 financial period.
According to the financial performance report released by the corporation, total assets dropped by 28.8 percent, from N1.513 trillion in 2022 to N1.076 trillion in 2023.
This decrease in total assets comes at a time when AMCON has been under considerable pressure to recover the toxic loans inherited from liquidated banks and indebted companies.
The Nigerian banking sector faced a severe financial crisis in 2008 and 2009, partly triggered by the global financial crisis, leading to the establishment of AMCON.
The Corporation’s initial investment was secured from the capital market through the Central Bank of Nigeria (CBN), and its operations have been funded through levies imposed on commercial banks.
Specifically, a statutory 0.5 percent charge on all banks’ total assets, including on and off-balance sheet items, finances AMCON.
Despite the asset decline, AMCON announced a good performance in terms of profitability. In a statement signed by AMCON’s spokesman, Jude Nwauzor, and made available to the media in Abuja on Wednesday, the Corporation reported triple-digit growth in profit, achieving a 202 percent increase from N34.730 billion in the previous year to N108.433 billion in 2023.
A detailed breakdown of the results shows that AMCON, under the leadership of Managing Director/Chief Executive Officer, Gbenga Alade, achieved Year-on-Year profit growth of 212 percent, rising from N34.730 billion in 2022 to N108.433 billion in 2023.
This growth was significantly driven by fair valuation gains on Eligible Bank Assets (EBAs), which surged to N40.9 billion in 2023 from a loss of N187.9 billion in 2022.
Additionally, AMCON’s equity portfolio saw an 82 percent growth in 2023, amounting to N43 billion compared to N7.9 billion in 2022. This substantial gain was attributed to improved performance in the stock market.
During the same period, the corporation achieved a reduction in total liabilities, decreasing from N6.282 trillion in 2022 to N5.739 trillion in 2023. This reduction was primarily due to the repayment of a N500 billion loan from the Central Bank of Nigeria (CBN).
Despite the positive profitability figures, experts have expressed concerns over the performance of companies indebted to AMCON.
They point out that many of these companies continue to struggle amid ongoing litigations and management challenges, which have eroded their values.
The harsh economic environment has further exacerbated these issues, making it increasingly difficult for AMCON to turn these entities into profitable ventures.
