In a landmark judgment delivered by the Chief Judge of the Federal High Court, Honorable Justice John Terhemba Tsoho, on March 28, 2024, in suit number FHC/ABJ/CS/ 889/16, the court affirmed the crucial role of the Asset Management Corporation of Nigeria (AMCON) in addressing non-performing loans within the financial sector. Led by legal representation from Henry Barnabas Ehi and Ekwere Nsikanabasi (Mrs), AMCON successfully argued its mandate under the AMCON Act 2010 to act as a debt recovery agency and resolve non-performing loans.
The judgment, which underscores the significance of AMCON’s role in maintaining financial stability, comes at a pivotal moment for Nigeria’s banking sector.
Henry Barnabas Ehi, MICA, representing AMCON, highlighted the vital importance of AMCON’s intervention, emphasizing that without its efforts, the banking sector would face the risk of collapse due to individuals with bad debts circumventing repayment obligations.
Chief Judge Honorable Justice Tsoho, in his ruling, wholeheartedly endorsed the arguments presented by AMCON’s legal counsel, affirming AMCON’s irreplaceable role in addressing non-performing loans. Justice Tsoho stressed the critical need for effective debt recovery mechanisms, noting the detrimental impact of unresolved bad debts on the stability of financial institutions. He emphasized that AMCON’s mandate to recover bad debts and initiate legal proceedings is indispensable in safeguarding the integrity of Nigeria’s banking sector.
Furthermore, Justice Tsoho expressed dismay at the evasive tactics employed by the defendants, highlighting the need for accountability and transparency in addressing non-performing loans. He condemned the actions of entities attempting to evade their financial obligations, underscoring the importance of upholding the rule of law and ensuring fair and equitable resolution of debts.
This judgment reinforces the authority vested in AMCON by the AMCON Act 2010 and reaffirms its pivotal role in resolving non-performing loans in Nigeria. By upholding AMCON’s mandate, the Federal High Court has signalled its commitment to promoting financial stability and accountability within the banking sector.
As Nigeria continues to navigate economic challenges, the judgment serves as a beacon of clarity and assurance, providing a robust legal framework for addressing non-performing loans and safeguarding the resilience of the financial system.
Empowering Financial Stability: Federal High Court Upholds AMCON’s Authority to Resolve Non-Performing Loans
