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Asset Management Corporation Bill passes second reading

A bill for an act to establish the Asset Management Corporation of Nigeria (AMCN) passed through second reading at the Senate on Wednesday. Leading the debate on the bill, Senate leader, Teslim Folarin, said the AMCN was conceived by the Federal Government as part of the on-going reforms of the banking sector.

He said the reforms, initiated by the CBN, was aimed at sanitising the banking sector as well as building the confidence of both depositors and investors in the industry.

Folarin urged his colleagues to support the bill, arguing that if passed, the AMCN would assist banks to efficiently manage and dispose off banks assets. He said the bill would also manage assets by taking all necessary steps to protect and enhance their value.

The lawmaker further argued that the bill would serve as a vehicle for resolving the huge non-performing assets of deposit money banks.
“It will clean up the balance sheets of the deposit money banks; hence their business operations will progress profitably and will be strengthened toward facilitating credit role of provider of capital to the real sector of the economy,’’ he added.

Many of the senators, in their contributions, spoke in support of passage of the bill.
Sen. Mohammed Mohammed (PDP, Bauchi), who argued in support of the bill, said poor supervision of existing regulatory bodies was responsible for the crisis in the sector.

He said those in the banking sector were required to have high integrity to manage capital but regretted that “what has been happening is flagrant irresponsible lending without due process.”

Sen. Justina Nwogu (PDP-Abia) said the bill would sanitise the sector, saying it could not have come at a better time.
“ In Nigeria, the only alternative has been complete liquidation. We know the history of banks’ failures with no remedy in sight to rescue them from collapse. This bill will help to fill in that gap and help to protect the banks from previous past mistakes,’’ she said.

Senate President David Mark congratulated his colleagues for their contributions, saying the bill would assist to correct the notion that banks deposits could be squandered with impunity.

While advocating the prosecution of those who misuse public funds, he argued that the bill would help to regulate the sector. The bill was consequently sent to the Senate Committee on Banking, Currency and Financial Institutions to commence the process of public hearing.


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