Le140.9 B NASSIT Toxic Loans In Limbo
By Aruna Momoh Kargbo
The sum of NLe140,929,375 which is equivalent to the sum of Le140,929,375,000 in old Leones dished out by the National Social Security and Insurance Trust (NASSIT) as loans to companies remains unpaid by the companies in question.
This was revealed by the protector of the Sierra Leone public purse, Audit Service Sierra Leone (ASSL) in the recently published report noting that after their review of the Trust’s investment portfolio, the Principal and Accrued Interest on Debenture Loans has not been paid to the Trust.
“There was however no documentation available to confirm the cumulative annual interest payments, which amounted to NLe161,869,135.96 as at 31st December, 2023,” the report stated.
The report also maintained that no evidence was provided to verify the repayment of the principal amounts, despite the fact that the loan tenures had elapsed.
The Auditor recommended that the General Manager, Mohamed Fuaad Daboh should ensure the overdue loan and interest payment from the joint venture and subsidiaries is immediately recovered; conduct a thorough review of its loan management practices, particularly those concerning related parties and that evidence of actions taken should be submitted to the ASSL.
NISSIT responded that the Investment and Projects Division prepared a proposal paper titled “Write-Off Toxic Debenture Loans” for the attention of the Management Investment Committee (MIC) and the Board Investment Committee (BIC).
“During the meeting, it was recommended that the Division should follow the procedures and processes for writing-off toxic loans which are guided by national and international accounting laws and the laws governing investments. The Investment and Projects Division through the support of the Legal and Board Secretariat Division should devise strategies to recover some of the toxic loans and debentures,” NASSIT stated.
ASSL however, stated that they were provided with an excerpt of the decision taken during the Management Investment Committee (MIC) meeting but that there was no evidence provided for the repayment of principal amounts and interests for audit inspection.
“The loans were still reported at their book values in the Financial Statements. Therefore, the issue remains unresolved,” the report noted.
