Journal of Banking Regulation

, Volume 13, Issue 2, pp 147–170

Asset management companies, non-performing loans and systemic crisis: A developing country perspective

Original Article

DOI: 10.1057/jbr.2011.28

Cite this article as:
Osuji, O. J Bank Regul (2012) 13: 147. doi:10.1057/jbr.2011.28


Nigeria's response to its 2009 banking crisis, which indicated exogenous and endogenous local and global risk factors for non-performing loans (NPLs), included the apparent orthodoxy of establishing an asset management company (AMCON). This article examines the justifications for and effectiveness of AMCON as a mechanism for resolving NPLs in a developing economy. Having compared Nigeria and Korea, the article argues that relief, restructuring, rehabilitation, recovery, resuscitation, responsibility, restitution and reoccurrence prevention, expressed as RE=7 × ReRe, are critical goals. Doubting a one-size-fits-all model for resolving systemic banking crises, this article suggests a contextual approach that considers asset characteristics, operative legal and regulatory environment, and market capacity.


asset managementBasel Committeebanking regulationnon-performing loansNigeriasystemic crisis

Copyright information

© Palgrave Macmillan, a division of Macmillan Publishers Ltd 2012

Authors and Affiliations

  1. 1.School of Law Cornwall Campus, College of Social Sciences and International Studies, University of ExeterPenrynUK