Nigerian central bank bars loans to big debtors post-crisis

(Reuters) - Nigeria's central bank has banned loans to 113 firms, including the country's two major airlines, which have failed to repay debts after a 2009 financial crisis that nearly brought down the banking system, an internal document obtained by Reuters on Sunday said.

The ban covers firms whose bad debts were absorbed by state-backed "bad bank" AMCON as part of efforts to draw a line under a credit crisis that nearly sank nine lenders. The companies have yet to make good on those loans, the memo said.

Nigeria's central bank injected $4 billion in 2009 to support nine lenders it judged to be so weakly capitalized they posed a threat to the whole economy. Since then, a number of banks have been restructured, and AMCON, the Asset Management Company of Nigeria, absorbed their toxic assets.

"As part of the Central Bank of Nigeria (CBN)'s efforts at strengthening financial stability, it has become necessary to stop debtors who failed to repay their loans to banks and had those loans transferred to AMCON from further enjoying credit facilities ... until they fully repay," the memo said.

"Banks are prohibited from approving or disbursing any new credit facilities to all persons and organizations on this list," it said, adding that any breach would be punished by a fine equal to the value loan and possibly additional penalties.

Names on the list included: Zenon Petroleum, privately owned by billionaire oil tycoon Femi Otedola, the majority shareholder in listed petrol firm Forte Oil (FO.LG); and MRS Holdings (CHEVRON.LG), which holds former Chevron downstream assets and is owned by Sayyu Dantata, brother of Africa's richest man Aliko Dangote.

They owe 192.4 billion naira ($1.22 billion) and 120 billion naira respectively, the document said. The list also included Nigeria's biggest national air carrier, Arik Air, with 85 billion in debts.

Neither Otedola nor Dantata were available for comment. A spokesman for Arik Air, Ola Adebanji, said the company had not been informed.

"There is a relationship between Arik and AMCON ... We have not received any document from CBN concerning that," he said.

Arik suspended its operations last week over a spat with unions, the airport authorities and the aviation ministry, partly over alleged unpaid dues, leaving thousands of passengers stranded. The airline resumed flights on Sunday.

Nigeria's only other functioning major airline, Aero Contractors, was also on the list but was not immediately reachable for comment.

AMCON nationalized three failing banks last year. It plans to refinance its 1.7 trillion naira ($10.80 billion) in repackaged bad loans into bonds when the debt expires next year. The banking crisis underscored structural flaws in Nigeria's economy, where powerful oligarchs are often accused of acting above the law, diverting company funds to personal interests and failing to honor huge debts.