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CBN Confident of Passage of Assets Bill

Senator David MarkThe Central bank of Nigeria (CBN) said the Assets Management Corporation of Nigeria (AMCON) bill before lawmakers would likely be passed into law before the end of the first quarter of this year.
The bill suffered a setback as the upper chamber of the National Assembly on Friday suspended its second reading.
'The Financial Compendium has been worked on and transmitted to the Senate today (Friday) and it is hoped that the Senate will consider it at the next legislative day. It is therefore very clear that the passage of the AMCON Bill is on track and would likely be completed within the first quarter of the year,' the CBN said in a statement.
At a plenary session, the Senate suspended second reading of the AMCON Bill following a point of order raised by a member that the bill does not include the financial implications.
In his ruling on the motion the Senate President, David Mark, insisted that such a bill must be accompanied by the financial implications.
AMCON is touted to soak the toxic assets of the CBN-intervened banks whose Chief Executive Officers were removed last year for granting loans without collateral security and which were not serviced by the borrowers.

The proposed corporation is expected also to provide liquidity and recapitalization assistance to the affected and other banks. AMCON is being considered among capital market operators as one of the magic wand that will lift current downturns on the floor of the Nigerian Stock Exchange (NSE).
The Central Bank of Nigeria through the Executive last year sent a draft Bill for the establishment of AMCON to the National Assembly for consideration and passage into law.
The CBN had wished that the corporation would have come on stream by now, but because of the rigorous process that the Bill has to pass through, this has not materialized.
'It has become necessary to assure all stakeholders that the Bill is merely going through the normal legislative process and in all likelihood the House of Representatives would pass it in a couple of days.'
The CBN also said progress is being made on the final resolution of Non-Performing Loans (NPLs), recapitalization issues of banks in the second quarter and getting all shareholders and regulatory approvals in the third quarter.
The Nigerian apex bank expressed the hope that by 30 September, 2010, all issues related to affected banks would have been resolved.

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