Asset Management Corporation Research Articles

Governance and competitiveness evaluation of China's financial asset management corporations.

With the development of non-performing assets market and the requirement of maintaining national financial security and stability, asset management corporations (AMC) have set up in recent years, facing the dilemma of governance reform and competitiveness improvement. This paper puts forward the Governance-Performance-Competitiveness theory of asset management corporations, and constructs the comprehensive competitiveness evaluation index system of based on internal and external governance mechanisms, and studies the factors and degrees of internal and external governance affecting competitiveness by combining principal component analysis method and grey correlation analysis method. The empirical results show that the asset scale and profitability of asset management corporations directly determine their competitiveness level to a large extent, and the correlation between external governance mechanism and competitiveness is stronger than that of internal governance mechanism. Clustering and grouping are conducted based on the size of competitiveness, and China's local asset management corporation system presents a diamond structure. China's local financial asset management corporations should strengthen the top-level design of internal governance, attach importance to external governance, expand and strengthen the asset scale, and carry out full-chains business while implementing a differentiated development model to achieve sustainable development when adhering to the principal business of non-performing assets.

THE STUDY OF GOVERNMENT POLICY ON STOCK MARKET DEVELOPMENT AND ECONOMIC GROWTH IN NIGERIA (1984-2020)

This study explored the relationship between stock market development and Nigerian economic growth. This was done to look at Nigeria's stock market and economic growth from 1984 to 2020. The analysis relied on secondary data. The Central Bank of Nigeria statistical bulletin for 2021 presented data on stock turnover ratio, stock market capitalization ratio, total value of shares exchanged ratio, all share index, and GDP. Granger causality, Augmented Dickey Fuller Unit root test, Johansen cointegration test, and error correction model were used to analyze the data. Granger causality was shown. There is no reverse causality between stock market development metrics such as stock market capitalization ratio, turnover ratio, or total value of shares exchanged ratio and economic growth. All share index, stock market capitalization ratio, turnover ratio, and economic growth were integrated of order 1, while total value of shares traded ratio was integrated of order zero, according to unit root test results. The Johansen cointegration test showed that the All-Share Index, Stock Market Capitalization Ratio, Turnover Ratio, and Economic Growth all have four cointegrating relationships. Changes in the all-share index have a positive and significant impact on changes in economic growth, whereas changes in the stock market capitalization ratio and its lag have a negative but insignificant impact on changes in economic growth (p>0.05). Changes in the turnover ratio have a positive but insignificant impact on changes in economic growth (p>0.05), while its lag has a negative but insignificant impact on changes in economic growth (p>0.05). Changes in lagged GDP have a positive and important effect on changes in economic present-period growth (p0.01), and economic growth and the independent variables in our model have a long-run relationship as indicated by the negative and statistically significant error correction term in the model (p<0.01). Based on the results, the study recommends that the Federal Government intervene through the Asset Management Corporation of Nigeria (AMCON)/Ministry of Finance Incorporated, that more indigenous quotable companies be encouraged to pursue listing by offering incentives such as tax holidays, tax rebates, and other incentives, and that stock broking firms be encouraged to join forces, either through mergers or outright acquisition amongst other recommendations.

Predicting Korea’ business-cycle regimes using OnBid auction data

Purpose This paper examines whether the successful bid rate of the OnBid public auction, published by Korea Asset Management Corporation, can identify and forecast the Korea business-cycle expansion and contraction regimes characterized by the OECD reference turning points. We use logistic regression and support vector machine in performing the OECD regime classification and predicting three-month-ahead regime. We find that the OnBid auction rate conveys important information for detecting the coincident and future regimes because this information might be closely related to deleveraging regarding default on debt obligations. This finding suggests that corporate managers and investors could use the auction information to gauge the regime position in their decision-making. This research has an academic significance that reveals the relationship between the auction market and the business-cycle regimes.

Financial System Regulation in a Pandemic: Evidence from Nigeria

Financial system soundness in world economies remains germane, but in the same vein, the COVID-19 outbreak had made governments scampering for any and every solution as experience has shown the need to incentivize businesses to enable economy-wide recovery. In this perspective, consideration of the Nigerian case is made, to re-echo possible collaboration by the Central Bank of Nigeria (CBN) and an operationally-associated agency - the Asset Management Corporation of Nigeria (AMCON). This viewpoint shows the role that AMCON could play to recoup extended facilities, in view to ensure financial system soundness, amidst others. Thus, efforts to leverage on this collaboration could aid going forward a fruitful operational effectiveness of so established policy responses.

Analysis of efficiency and productivity of regional headquarters of Korea Asset Management Corporation using DEA and MPI

Analysis of efficiency and productivity of regional headquarters of Korea Asset Management Corporation using DEA and MPI

Competing Equities and the Applicability of Section 34[1] of the Asset Management Corporation of Nigeria Act, 2018: Review of the Ruling of the Federal High Court in Suit No. FHC/L/CS/1073/2019 - Asset Management Corporation of Nigeria Vs. Olaosebikan Stores Nigeria Limited & 8 Ors.*

Competing Equities and the Applicability of Section 34[1] of the Asset Management Corporation of Nigeria Act, 2018: Review of the Ruling of the Federal High Court in Suit No. FHC/L/CS/1073/2019 - Asset Management Corporation of Nigeria Vs. Olaosebikan Stores Nigeria Limited & 8 Ors.*

Strengthening Financial System Regulation: The Nigerian Case

Many studies have considered the efficacy of the Central Bank of Nigeria (CBN)’s monetary policy to ensure Deposit Money Banks (DMBs) performance in Nigeria but scantily mentioned in literature are assertions on other roles that the Asset Management Corporation of Nigeria (AMCON) - an agency aligned to the CBN, could perform to further strengthen the efficacy of the CBN’s monetary policy (and/or macro/microprudential guidelines) in financial sector management, even so during this COVID-19 pandemic and afterward, and besides AMCON’s statutory role of debt recovery. Also, the need for initiatives that could inform efforts to strengthen the efficacy of CBN’s policy instruments, despite post-2010 debt-recovery activities by AMCON, remains. Thus, this review article examines the activities of AMCON and their implications on CBN’s policy instruments design/formulation and implementation in Nigeria. Our findings thereof include AMCON contributes to DMBs’ surveillance which could inform CBN’s policy instruments design/formulation, and that the basis of the association between CBN and AMCON is prominent in respect to policy instruments’ implementation and compliance. Therefore, this study recommends CBN to leverage on AMCON’s recurrent interface with DMBs to further strengthen the operational effectiveness of so established policy instruments.

AMCON (Amendment No. 2) Act 2019 and Its Weighty Flaws

The Asset Management Corporation of Nigeria (AMCON) was established with the core mandate of saving the Nigerian banking system from collapse under the weight of toxic loans. AMCON’s primary objective was to purchase soured loans from commercial banks and subsequently recover the loans from debtors. Nine years after its establishment, AMCON is presently faced with mountainous debt profile valued at over N5 trillion. This is indubitably gargantuan when considered that it is about 60% of the 2019 budget of the Federal Government which is N8.92 trillion. Worse still, AMCON is in a race against time in view of its sunset clause. As part of efforts towards refortifying AMCON, on 7 August 2019 President Mohammadu Buhari assented to the Asset Management Corporation of Nigeria (Amendment No. 2) Act 2019 (AMCON Act 2019). AMCON Act 2019 amends AMCON Act 2010 which had been previously amended in 2015. Notwithstanding the good intentions which incentivized the amendments, AMCON Act 2019 is replete with constitutional breaches and dereliction of democratic norms.

Study on the legal issue about the management of the public funds in the insurance industry

1997년 말 외환위기로 금융부실문제를 정상화시키기 위하여 금융구조조정 등에 자금이 지원되었는데 이를 통상적으로 공적자금의 지원이라고 한다. 현재 공적자금은 2000 년 12월에 제정된 공적자금관리특별법에서 정한 공적자금(I)과 2009년 5월 개정된 공적자금 관리특별법에 따른 구조조정기금으로서의 공적자금(II)로 구분되고, 2008년 2월 금융위원회의 설치 등에 관한 법률 개정에 따라 이에 대한 관리업무를 금융위원회가 맡고 있다. 공적자금의 순환은 자금의 조성, 지원, 회수, 상환 및 사후관리인 5단계를 거치게 된다. 공적자금은 예금보험공사와 자산관리공사가 발행한 채권을 정부가 보증하는 방식으로 공공차관 또는 국유재산 등에서 조달한 공공자금으로 조성된다. 문제는 공적자금이 원칙에 맞지 않게 회수와 상환과정을 거치면 그 최종적인 책임은 정부가 지게 되고, 이는 고스란히 국민부담으로 된다. 더욱이 공적자금의 상환계획기간인 25년을 넘긴다면 공적자금 수혜세대와 상환세대가 달라져 세대갈등의 요인이 될 수 있다. 그러므로 공적자금의 회수 및 상환은 매우 엄격하게 이루어져야 한다. 현재 공적자금의 회수 절차에서는 회수율에 왜곡이 심각하다. 회수금액은 원리금이 아닌 원금을 기준으로 하고 있고 실제로 시간가치가 고려되고 있지는 아니하다. 또한 출자방식으로 한 공적자금의 지원의 경우 수령한 배당금도 공적자금 회수에 포함하고 있어 이에 대한 적절성이 문제가 된다. 또 다른 문제점으로는 2002년 ‘제1기 공적자금관리위원회’ 기간에 공적자금의 회수와 관련하여 그 상환의 불확실성이 있다고 판단하고 상환대책을 마련하였는데 당시 정부는 공적자금의 회수가 용이하지 않다고 추정되는 부채 69조원 중 재정과 금융회사 분담비율을 각각 49조원과 20조원으로 나누어 분담하는 것으로 정하고, 매 5년마다 이를 재산정하도록 한 바 있다. 그런데 최근 논의를 보면 초기와는 다른 시장환경이 조성되었음에도 불구하고 국가재 정의 의존도가 높은 49:20을 고수하려는 것은 문제가 있다. 공적자금 상환과 관련하여 가장 큰 문제는 공적자금 지원의 주원인이 은행권에서 발생한 것인데 공적자금 상환부담이 보험권에 과중하다는 것이다. 현행 보험권 예금보험료 및 상환 기금 특별기여금의 산정체계는 은행 등 타 금융업권 대비 불합리한 요소들이 있어 이에 대한 시급한 수정이 불가피하다. 이상의 문제점은 합리적인 근거와 형평성의 제고 차원에서 다시 논의되어져야 한다.In order to resolve the insolvency of the financial institutions due to Korean Financial Crisis in 1997, the Korean government (through its agency) provided the funds to the financial institution for the reorganization, which is called “publically supported funds”. The publically supported funds are classified to the public fund I pursuant to “Special Act on the Management of Public Funds” enacted in 2000 and public fund II pursuant to “Special Act on the Management of Public Funds” revised in 2009. Since 2008, the Financial Services Commission has been in charge of this work pursuant to “Act on the Establishment, etc. of Financial Services Commission” revised in 2008. The cycle of public funds goes through five stages: funding, support collection, repayment, and ex post facto management. The public funds are financed from the public loans or state-owned properties in a way of the bonds issued by the Korea Deposit Insurance Corporation and Korea Asset Management Corporation, and the bonds are guaranteed by the Korean government. However, if a financial institution which supported by public fund repay the money in accordance with the “principle”, the final responsibility will be borne by the government, and this will be borne by the public. Moreover, if the repayment period for public funds exceeds 25 years, it will be a factor of generation conflict due to the difference between beneficiaries and reimbursement parties. Therefore, the collection and repayment of public funds must be very strict. At present, there is a serious distortion in the recovery rate in the process of collecting public funds. The collection amount is only based on principal without the reflection of the time value. Also, in the case of the support of public funds in the way of equity, it requires the further study on adequacy in terms of the received dividend in the way of the collection for the supported public fund. The second issue is government policy. The government decided to share total debt amount, 69 trillion won which was uncertain about the repayment of related to the recovery of the public funds between the national finance and the financial institutions into 49 trillion won and 20 trillion won. Because of the uncertainty of repayment and recovery, the 1st Public Fund Management Committee pointed out it and the committee arranged another plan for it. However, in recent discussions, it is problematic to adhere to the ration, 49:20, which is highly dependent on national finances, despite the market environment is changed. The last material issue with the repayment of the public fund is that the liability to repay the public fund is heavily weighted to insurance industry even though the main reason for supporting public funds has occurred in the banking industry. The current calculation system of the deposit insurance premium and the special assessment in the insurance industry has unfairness in comparison with other indu stry such as banks. It is inevitable to amend the current calculation system. The above-mentioned issues should be discussed again in terms of rational basis and equity.

A Study on the Effective Management System for the State-Owned Properties with the Utilization of Dron

작년 12월 22일 국토교통부는 보도 자료를 통해 드론 산업의 규모를 5년 내에 20배 육성하기 위하여 향후 10년간 드론산업을 이끌 밑그림인 범부처 합동 「드론산업발전 기본계획(2017년-2026년)」을 확정·발표한 바 있는데, 이를 통해 연 29퍼센트의 성장이 전망되는 세계 드론 시장에서 점유율을 확대하고, 특히 이미 활성화된 개인용 드론 시장보다는 아직 상대적으로 비활성화된 사업용 드론 시장을 견인해 나아갈 수 있는 경쟁력을 확보하는 것을 목표로 설정한 바 있다. 한편 이러한 흐름에 발맞추어 최근 한국자산관리공사는 국내 최초로 ‘드론’을 활용하여 대규모 지역을 측량한 뒤 정밀한 영상 지도를 생성하고 현황을 판독할 수 있는「토지조사 시스템」에 관한 특허를 등록하고, 이를 통해 소규모 인력만으로도 보다 정밀하고 효율적인 토지조사와 측량 오차가 적은 고해상도의 3차원 입체영상의 제작을 시행하고 있는데, 특히 한국자산관리공사는 국유재산의 관리 및 조사 업무를 위해 국유재산관리 전문 인력으로 구성된「국유재산 총조사 추진단」을 발족하고, 드론의 구입과 조사 인력의 모집, 모바일 앱의 개발과 시범조사의 실시 등 국유재산 총조사 수행에 필요한 업무를 전담하도록 함으로써 국유재산 총조사에 드론을 적극 활용하고 있는 상황이다. 이와 같이 한국자산관리공사가 “국유재산 총조사” 사업을 추진함에 있어 ‘드론’을 적극 활용하는 것은 단지 국유재산의 현황 조사와 관리를 위한 하나의 수단으로서만이 아니라 국토교통부가 발표한 드론산업발전을 위한 기본계획에 부합하고 나아가 국내 드론 시장의 확대 및 관련 산업의 발전에 이바지할 수 있는 매우 바람직한 제도라 할 것인바, 이러한 관리체계가 원활하게 운영될 수 있도록 그에 대한 검토가 필요하다 할 것이다. 이에 본 논문에서는 기획재정부와 한국자산관리공사가 국유재산 총조사 사업을 진행함에 있서 ‘드론’을 적극 활용하는 국유재산 관리체계가 성공적으로 정착되어 운영될 수 있도록 ‘드론’의 활용을 중심으로 ‘드론’을 활용하는 국유재산 관리체계의 효율적 운영방안에 대하여 검토하고 방안을 제시해보고자 한다.The Ministry of Land, Infrastructure and Transport announced on December 22 last year 「the Drone Industrial Development Plan (2017-2026)」, the joint project between the related government agencies, which is expected to lead the drone industry for the next 10 years. The Ministry of Land, Infrastructure and Transport has established a goal that it will expand its market share in the global drone market expected to grow at an annual rate of 29 percent a year and achieve the market competitiveness to set to trend in the commercial drone market, which is the market relatively inactive compared to the personal drone market. Along with this trend, the Korea Asset Management Corporation (KAMCO) recently registered the patent,「Land Surveillance System」, that is able to generate and to provide a precision video map after measuring areas on a large scale, and it makes the high-resolution 3D images more accurate and precise and provides the land survey project which can be performed by small group of people with this system. Especially, the KAMCO had recently launched「the State-Owned Property Census Promotion Committee」 to undertake all the tasks necessary to carry out the total investigation such as purchasing drones, recruiting survey personnel, developing mobile applications, etc. in order to use drones for the census of stated-owned properties.

An Appraisal of the Central Bank of Nigeria’s Approach to Resolution of Skye Bank Plc

On 21 September 2018, the Central Bank of Nigeria (CBN) revoked the banking licence of Skye Bank Plc on the ground that it was significantly undercapitalised. The CBN also claimed that Skye Bank’s shareholders were unable to recapitalise the bank. CBN’s first regulatory intervention in Skye Bank was on 4 July 2016 when the CBN replaced some board members and injected N350 billion into the bank. Polaris Bank Ltd (a bridge bank) has been established to take over the assets and liabilities of Skye Bank. The CBN and the Nigerian Deposit Insurance Corporation (NDIC) have turned over Polaris Bank to the Asset Management Corporation of Nigeria (AMCON). AMCON has injected N786 billion into Polaris Bank and is expected to source for a credible investor. This write-up examines Skye Bank’s resolution and key issues arising therefrom such as the special insolvency regime for banks, the bridge bank approach, bail-outs and bail-ins, the too-big-to-fail principle and moral hazard, and the treatment of Skye Bank’s shareholders.

A Comparative Analysis of the Asset Management Corporation of Nigeria and the Troubled Asset Relief Program of the United States

This article is a comparative analysis of the Asset Management Corporation of Nigeria (AMCON) with the Troubled Asset Relief Program (TARP), in the US. AMCON is an institution which was created to purchase non-performing loans of Nigerian banks due to their exposure to the oil and gas sector and the capital market. AMCON acquires these toxic loans of both distressed and sound banks, and then converts the loans to equities and sells them off. Banks that wish to sell their toxic loans to AMCON sustain losses since the average purchase price is 40% of the cost of the loan. Once AMCON purchases the toxic loans of banks, it issues seven-year Federal Government guarantee bonds to the banks. TARP, on the other hand, was established under the Emergency Economic Stabilization Act, 2008, to ameliorate the effects of the 2007 global financial crisis on the US economy. Its primary focus was on addressing the impact of the crisis on financial institutions as a result of their exposure to subprime mortgages. TARP later incorporated automobile companies into its program, as the failure of these companies, at the time, would have had a more significant impact to the US economy. The Secretary of the Treasury is responsible for the purchase of troubled assets, the management and sale of the assets and the remittance of the revenue from the sale to the US Treasury. TARP is encompassing and has the Financial Stability Oversight Board, the Congress, the Congressional Oversight Panel, the Comptroller General of the US, Judicial Review and Special Inspector General to help the Secretary in the performance of his duties. These checks and balances are lacking in AMCON; hence, the tendency of abuse of power is high under AMCON. While TARP has succeeded in stabilizing the US economy, AMCON is still struggling to stabilize the Nigerian banking sector. On further examination of these two institutions, this paper finds that there are a number of factors which hinder the realization of AMCON’s objectives. Primarily, this paper finds that there are no favourable government policies to complement AMCON. The absence of such policies, is challenging for the sustainability and regulation of the Nigerian banking system. This article concludes that similar to TARP, AMCON must be further developed and strengthened, and contain a more exhaustive system of checks and balances. In addition, it must incorporate more favourable government policies in order to be a success story.

Group-Decisions, Economic Policy and the Resolution of Non-Performing Loans

Non-performing Loans (NPLs) have international ramifications because many banks operate in several countries and NPL-resolution related laws enacted in their home countries affect their foreign operations. While the management of Non-performing Loans (NPLs) remains a major problem around the world and requires long term preventive measures, Asset Management Corporations (AMCs) which are an afterthought (sometimes politically-motivated and usually introduced after non-performing loan - NPL - rates have exceeded permissible levels), have been created in various countries to help resolve NPLs and associated banking crisis. There have been mixed reviews of the effectiveness of AMCs and other methods of resolution of bank crisis in general; and AMCs can amplify financial instability and systemic risk problems in national banking systems. Within the context of the operations of Asset Management Corporation of Nigeria (AMCON), this article explains the following: i) accounting disclosure, “Bank Opacity” and behavioral problems may contribute to increases in earnings management and systemic risk; ii) there have may been a symbiotic relationship between the liquidity of Nigerian Banks’ shares/GDRs and institutionalized earnings management and corporate governance deficiencies on one hand, and AMCONs’ activities ii) AMCON has failed in its purpose and its business model has increased systemic risk and financial instability; iv) the AMCON business model caused other social and economic problems – such as Inefficient Cross-Subsidization (among banks and industries), Valuation-losses, Distortion of Borrowers’ Willingness-To-Resolve and Moral Hazard, and increased earnings management in various industries in Nigeria; v) the interaction of industry-level, firm-level and institutional-level corporate governance factors can affect banks’ reactions to AMCs’ activities. The article also proposes testable hypothesis, new theories of group-decisions and antitrust, and feasible solutions to problems caused by NPLs, AMCs in general (and AMCON in particular) and the Corporate Governance and antitrust deficiencies discussed herein.

Gentrification, suburban decline, and the financialization of multi-family rental housing: The case of Toronto

While traditional forms of gentrification involved the conversion of rental units to owner-occupation, a new rental-tenure form of gentrification has emerged across the globe. This is driven by financialization, reduced tenant protections, and declining social-housing production, and is characterized by the replacement of poorer renters with higher-income tenants. Many poorer renters are in turn being displaced out of the inner city and into older suburban neighbourhoods where aging apartment towers had provided a last bastion of affordable accommodation, but which are now also targeted by large rental housing corporations. These dynamics are increasingly dominated by what we call ‘financialized landlords,’ including those owned or run by private equity funds, financial asset management corporations, and real estate investment trusts (REITS). Such firms float securities on domestic and international markets and use the proceeds to purchase older rental buildings charging affordable rents, and then apply a range of business strategies to extract value from the buildings, existing tenants and local neighbourhoods, and flow them to investors. This paper documents this process in Toronto, Canada's largest city and a city experiencing both sustained gentrification and advanced suburban restructuring. The financialization of rental housing in Toronto was enabled by neoliberal state policies to withdraw from social housing, deregulate rental protections, and decontrol rents – creating an affordability crisis for tenants and an opportunity for investors to profit. The paper maps out the history and locations of buildings that have been purchased by various financial investment vehicles, and analyzes the various strategies that such firms have adopted. We document two key strategies for extracting value, which we call squeezing, and gentrification-by-upgrading and show how these two strategies are conceptually and spatially linked in speeding up the restructuring of the social geography of the city.

Restructuring an Emerging Market Banking Sector: The Case of Vietnam

This article examine whether Vietnam will be able to follow the reconstruction model developed by the Thai and South Korean banking industries in 1997, based on present-day Vietnam’s similarity with those two countries in 1997. Our paper also attempts to test the efficiency of the Vietnamese Asset Management Corporation [VAMC] in the banking industry restructuring process. The article use a quantitative model to test effects of the VAMC on Vietnam’s banking industry, and apply a DEA model to test the efficiency of the VAMC. The results contribute to the process of restructuring the banking industry in Vietnam, it also provide guidelines based on mathematical analysis for potential changes and improvements to both the banking industry and the bank regulatory structure in Vietnam.

Nonperforming Loans and Purchase of Loans by Public Asset Management Companies in Malaysia and Thailand

AbstractThis paper explores the factors which eliminated the nonperforming loan (NPL) problem in Malaysia and Thailand following the 1997 Asian financial crisis. The number of NPL, which expanded in the aftermath of the crisis, has since declined in most South‐East Asian countries. Although previous studies have explored the causes of the increase in NPL numbers, few have analysed the factors that contributed to the reduction in their number in Asia. In Malaysia and Thailand, authorities put in place several measures to manage NPL. As a vehicle to acquire NPL from banks, Malaysia established the Pengurusan Danaharta Nasional Berhad (Danaharta) in 1998, while Thailand established the Thai Asset Management Corporation (TAMC) in 2001. We analyse whether the characteristic features of banks, improvements in macroeconomic conditions, and facilities for purchasing loans caused a reduction in the number of NPL in Malaysia and Thailand. The results suggest that selling loans to a public asset management company was effective in reducing the number of NPL in Thailand. While macroeconomic conditions influenced the decline in NPL ratios in Thailand, in Malaysia, well performing commercial banks and large commercial and investment banks generally had smaller NPL ratios throughout and following the crisis.

Applicability of the Consent Requirement of the Nigerian Land Use Act to the Asset Management Corporation of Nigeria Act

AbstractThe Nigerian Land Use Act (LUA), which governs contemporary Nigerian land law, provides that any disposition of land must have the prior consent of the appropriate authority under the LUA. However, the Assets Management Corporation of Nigeria Act, which regulates the disposition of eligible bank assets, contains provisions that imply that the requisite consent under the LUA is not required for the disposition of an eligible bank asset consisting of land. This article interrogates the propriety of the provisions of the Assets Management Corporation of Nigeria Act in this regard and argues that, in view of the fact that the LUA is a statute with constitutional flavour by virtue of its entrenchment in the Nigerian Constitution, the LUA's provisions supersede the provisions of any conflicting law.

A Critical Assessment of Asset Management Corporation of Nigeria (AMCON) as an SPV

The monumental financial crisis that rocked the Nigerian economy during the 2009-2010 fiscal years was unprecedented. Contrary to the phoney and bogus assurance the banks gave its customers following the 2004/2005 bank consolidation exercise which witnessed banks consolidating into 25 ‘stronger’ banks, the financial institution were sitting on a land mine waiting to explode at the slightest move.

An Appraisal of the Value of Asset Management Corporation of Nigeria to Creditor Rights Regime in Nigeria

The CBN regulates for creditor protection through four bases, one of which is the special purpose vehicle of AMCON. The AMCON as a regulatory base is an interventionist tool for the protection of the largest class of Nigerian creditors, the deposit money banks. Looking at the activities of AMCON since its establishment, it has added value to creditor rights regime in Nigeria. One of which was wiping out the NPLs in the system. Another is establishing thresholds for NPLs which any bank could hold, among others. However, there are factors which could impinge on AMCON’s rescue agenda. The issue of debt forbearance and the problem of moral hazard are just examples of such factors. Since the largest room in the world remains the room for improvement, the constraining factors to AMCON’s efficiency meant that there is agenda for reform.

Asset Management Corporation of Nigeria A Pretentious Special Purpose Vehicle

In contemporary financial world, business organisation most especially financially distressed companies and companies with low or mid-tier credit ratings have securitised different types of assets (loans, credit cards, auto receivables, intellectual property, etc.) through the use of SPVs. The enactment of the AMCON ACT 2010 was specifically to bail out the Nigerian banks by buying and taking over the 'toxic' assets that were threatening to destroy the banks and the economy. This paper analysed the essential features of the procedure for securitisation and asset management modules as a background to critically examine the AMCON ACT and whether the Asset Management Corporation is an SPV or not. The paper concludes that AMCON is not an SPV but a special statutory creation to solve a special problem confronting the banks and the economy.