Press "Enter" to skip to content

AMCON rakes N94.2bn from 5 top banks

…Banks shareholders kick, demand shutdown of AMCON’s operations
…Say it’s levy on financial institutions denying them dividends
…’AMCON contributions by banks to run for 10 years’
The Assets Management Corporation of Nigeria (AMCON) collected a whopping N94.2 billion from five Domestic-Systematic Important Banks (D-SIBs) operating in the country in 2017, The Daily Times can authoritatively report.

The five financial institutions levy to the AMCON grew by 14 per cent from N82.1 billion in 2016 despite shareholders call for closing of operations.

It means that the 17.5 per cent proportion of the five Central Bank of Nigeria’s (CBN) D-SIBs profit was paid to AMCON as levy in 2017.

The five financial institutions are FBN Holdings Plc, Zenith Bank Plc, Access Bank Plc, United Bank for Africa Plc and Guaranty Trust Bank Plc.

All deposit money banks in operating in Nigeria are required to contribute 0.5 per cent of total assets as at the preceding year end to AMCON’s sinking fund in line with existing guidelines.

The fund is non-refundable and does not represent any ownership interest nor does it confer any rights or obligations on the contributor.

According to The DailyTimes findings, FBN Holdings’ with N5.2 trillion in total assets last year paid regulatory cost of about N31.5 billion, 9.3 per cent increase over N28.8billion in preceding year.

Closely following FBN Holdings is Zenith Bank with N21.42 billion AMCON levy in 2017 from N18.75 billion in 2016, an increase of 14 per cent. Zenith Bank total assets thus reported 18 per cent increase in total assets to N5.59 trillion from N4.74 trillion in 2016.

With about N4.1 trillion in total assets, Access Bank paid AMCON levy of N15.47 billion in 2017, 28.3 per cent increase over N12.1 billion in 2016 while GTBank paid AMCON sinking funds of about N13.1 billion in 2017 from N11.4 billion in 2016.

AMCON levy contributed 14.9 per cent to GTBank’s total operating expenses in 2017.

In addition, UBA’s AMCON levy hits N12.7 billion in 2017, 14.6 per cent increase over N11.08 billion recorded in 2016.

As earlier stated, the five D-SIBs paid 17.5 per cent of their total profit in 2017 to AMCON, which implies that an accumulative N536.8 billion was generated as profit in 2017 from N422.8 billion reported in 2016.

Highest gainers by percentage include FBN Holdings, Zenith Bank and GTBank while Access Bank recorded drop in profit.

FBN Holdings reported 178.8 per cent increase in profit to N47.8billion from N17 billion in 2016 while Zenith Bank’s profit also rose by 37 per cent in 2017 to N177.9 billion as against N129.65 billion in 2016.

For Access Bank, its profit dropped by 13 per cent to N61.99 billion from N71.4 billion in 2016 while GTBank report grew by 29 per cent to N170 billion from N132 billion in 2016.

Also, UBA’s profit increased marginally by nine per cent to N78.59 billion in 2017 as against N72.26 billion reported in 2016.

But shareholders over the years had called on the Federal Government to shutdown the operations of AMCON, stating that hike in AMCON levy is denying them of their dividends.

Specifically, the shareholders of GTBank at this year’s Annual General Meeting (AGM) had frowned at the rising level of the AMCON levy that hit N13 billion in 2017.

The National Coordinator Emeritus, Independent Shareholders Association of Nigeria (ISAN) and President, Nigeria Shareholders Solidarity, had expressed displeasure of shareholders over the AMCON levies.

According to them, the levy increases the companies’ expenses and erodes the dividend to be accrued to shareholders in terms of dividend at the end of the year.

Responding, the Managing Director of GTBank, Mr. Segun Agbaje, said AMCON contributions are to run for 10 years.

Agbaje explained that if the contributions exceeded 10 years, then it is by act of legislation.

According to him, the AMCON levy was imposed on institutions in the country via a bill signed into law in 2010 as a sinking fund which initially represents 0.03 per cent of these institution’s total assets, but was increased to 0.05 per cent.

Be First to Comment

Leave a Reply