ABSTRACT
One of the most conclusive lesson of economic theories over the past three centuries is that free
markets, when allowed to operate within the norms of fairness to all market participants, lead to
enhanced growth in the national economy. When government fails in its role as a regulator, it
creates the market noise that may lead to market failures. Attempts to deal with these failures in
themselves sometimes deepen the problem. Sustained market failure results in economic
depressions, which are significant dislocations and depletion in the national well being through
losses in individual wealth. In the aftermath of the global financial crisis that erupted in 2007 and
2008, several governments across the world adopted emergency economic and financial measures
to confront the massive financial implosions that faced their national economies. Some of these
measures were put in place without thorough academic, legal, or policy analysis.
These fire brigade
approaches to national emergencies seemed necessary to avert national financial calamities,
especially where some of the leading economies of the world were prodding others to respond. In
Nigeria, rash monetary authority examination of the financial crisis created uncoordinated
responses that jig-sawed from indictment of nearly half of the leading financial institutions in the
country, forced bail out of some of the institutions through infusion of public funds, removal of
financial institutions management teams, to the birth of AMCON. However there have been
criticisms leveled against the establishment of AMCON, It is against this background that this work
examined and critiques the Asset Management Corporation Act of Nigeria 2010. Consistent with
the above the study sought to; examine the Act establishing the Asset Management Corporation of
Nigeria in the light of other existing Acts in Nigeria; examine the rationale behind the contribution
of public fund as a start-up capital for the Asset Management Corporation Nigeria; examine what
constitute eligible bank asset in line with Asset Management Corporation of Nigeria classification
of bank asset; and examine what constitute debt in line with Asset Management Corporation of
Nigeria definition of Non-performing loans. The research design adopted was the comparative
research design and the ex post facto research design to enable the researcher makes use of
secondary data.
The findings from the research revealed that the duty of AMCON as regard being a
systemic regulatory agency is in conflict with CBN, NDIC, EFCC and other existing laws put in
place to strengthen the financial sector of Nigeria; Asset Management corporations in other
jurisdictions have government funds as start-up capital, thus the use of government fund in the
establishment of AMCON is not out of place; the Act did not give the banks, their shareholders or
directors a hearing as to the classification of eligible bank assets; the Act definition of debt is
vague, as regards classifications of debt as performing, doubtful and non-performing which banks
are required to make provisions for. The study thus recommends that government should encourage
the development of a free market in Nigeria where market forces are allowed to determine price
and output. It is only in such an atmosphere the long-run growth and development of the Nigerian
economy could be achieved and sustained.
