Nigeria’s state-backed bank tasked with absorbing lenders’ bad debts, AMCON, reported a 2012 loss of 822.9 billion naira ($5.2 billion) after taxes on Wednesday, three years after it was formed in the aftermath of a financial crisis.
It was a substantial improvement on the after-tax loss of 2.37 trillion naira ($14.9 billion) that the Asset Management Company of Nigeria posted as of December 2011.
But the loss was still equivalent to around a sixth of the annual budget of Africa’s second-biggest economy.
AMCON, which expects to conclude by mid-2014 the re-privatisation of three banks nationalised after a 2009 financial crisis, said in its financial statement that the lenders had a combined worth of about 100 billion naira, representing about 5.7 percent of its assets.
The bank was set up to absorb bad debts left over from a financial crisis that nearly bankrupted nine lenders until the central bank spent about $4 billion to bail them out.
It said it purchased about 10,000 loans representing about 45 percent of its 2.85 trillion naira worth of total assets.
AMCON said it had restructured half of its portfolio of bad loans and that about half of those restructured assets were performing. It said it had collateral for the non-performing ones.
Written by Chijioke Ohuocha | Read more at Reuters