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House to Probe CBN, AMCON over N1.4tr Fund

Category: Regulators

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House to Probe CBN, AMCON over N1.4tr Fund


November 3, 2011

The House of Representatives has mandated its Committee on Banking and Currency to investigate the Central Bank of Nigeria (CBN) and the Asset Management Corporation of Nigeria (AMCON) over Federal Government’s N1.4 trillion intervention funds.

The House, which gave the order Wednesday, further mandated the committee to examine the Banks and Other Financial Institutions Act (BOFIA) and AMCON if they conformed with the 1999 Constitution as amended.

The News Agency of Nigeria (NAN) reported that the House also urged President Goodluck Jonathan to include the budget of the CBN and all independent revenue earning agencies of government in the 2012 budget proposal in line with the provisions of the Fiscal Responsibility Act 2007.

This resolution emanated from a motion by Hon. Uzoma Nkem-Abonta (PDP-Abia), which was unanimously adopted.

Leading the debate, Nkem-Abonta noted that in 2009, the CBN injected N620 billion of public funds to rescue private banks, N500 billion for private manufacturers, N200 billion for textile industry and N100 billion for the aviation sector.

He said in 2011, in conjunction with the NDIC and AMCON, it injected N679 billion to recapitalise same banks without approval.

“The Asset Management Corporation of Nigeria, a government agency, announced that it will inject another N821 billion to revive some ailing banks again,” he said.

He said the apex bank, contrary to its core functions and mandate, had acquired several hectares of land in the FCT for the purpose of investing in hospital and property.

According to him, the bank had paid N17 billion for Nigeria Telecommunications Limited (NITEL) property earlier sold for N1.8 billion.

He stated that recurrent and capital budget of CBN was not being subjected to appropriation.

Chairman, House Committee on Appropriation, Hon. John Enoh (PDP-Cross River), reminded the House that the Minister of Finance had been told to include the CBN budget in the 2012 estimates.

Also,  Hon. Razak Bello-Osagie (ACN-Edo) said the apex bank had no constitutional right to appropriate fund to itself, while Hon. Adams Jagaba (PDP-Kaduna) enjoined the committee to look beyond the semantics that the chief executives would deploy and look closely at the issues involved.

Jagaba said no cost should be spared to engage experts who would scrutinise the transactions closely.

Similarly, the House Committee on Business and Rules has been mandated to circulate a clean copy of the Banks and Other Financial Institutions amendment Bill for consideration in the Committee of Whole.

The Bill seeks to repeal and re-enact the Banks and other Financial Institutions Act, 2004 and re-enact the Banks and Other Financial Institutions Act 2011.


Source: Thisday

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