FILE- In this April 26, 2007 file photo, cabin crew members with Arik Air stand in front of a new Boeing 737-700 purchased by Arik Air, at Boeing Field in Seattle, Washington. Arik, Nigeria's largest airline, announced Thursday, Sept. 20, 2012 that it has halted all domestic flights alleging that government corruption made it impossible for it to fly. Arik ending its domestic flights will add further chaos to Nigeria's aviation industry. The country is still trying to recover from an airline crash that killed more than 160 people in June.(AP Photo/Ted S. Warren, File)
LAGOS, Nigeria (AP) — Nigeria's Central Bank has barred the nation's top two airlines from receiving any additional loans over their massive outstanding debts, an official said Friday, as passengers were stranded by the nation's aviation industry crisis in which its largest carrier grounded all its domestic flights.
Arik Air Ltd., the nation's top carrier which indefinitely halted its domestic flights Thursday claiming that the nation's aviation minister wanted to destroy the company for her personal profit, owes the state-run Asset Management Corp. of Nigeria more than $534 million, according to information released by the Central Bank.
Aero Contractors Co. of Nigeria Ltd., the airline of choice for many of the foreign oil companies working in Nigeria, owes more than $203 million to the state-run company, according to the Central Bank.
Ugo A. Okoroafor, a Central Bank spokesman, told The Associated Press on Friday any bank that gave companies or individuals on the list loans would face serious fines from the government. While acknowledging the struggles of the airline industry, the spokesman said the bank could not allow massive debts to pile up on the nation's banks and threaten the financial market.
"Adverse consequences exist for people who take part in such unhealthy acts," Okoroafor said.
Simon Tumba, a spokesman for Aero Contractors, declined to immediately comment Friday. Arik Air spokesman Adebanji Ola said the airline "was not in receipt of that particular" order by the Central Bank and declined to comment further.
The list of debtors barred from bank loans, first published in the Friday edition of ThisDay newspaper, also includes other top members of Nigeria's business elite, who regularly have access to and patronage of top politicians in the oil-rich nation.
Jimoh Ibrahim, who ran carrier Air Nigeria until the company recently collapsed owing staff four months' pay, owes the state-run company $175 million for loans to his company Nicon Investments Ltd. Zenon Petroleum & Gas Ltd., run by Femi Otedola, a supporter of President Goodluck Jonathan, owes an eye-popping $1.2 billion to the state-run asset company.
The Central Bank's decision likely will sow further chaos in Nigeria's aviation industry, which has been plagued by problems since a jetliner crash in June killed more than 160 people in Lagos. Only three of Nigeria's nine domestic airlines are now flying, as others remained grounded over maintenance, financing or other problems.
Thursday, Arik Air announced it would stop all its domestic flights following what it described as a raid by Federal Airports Authority of Nigeria employees on its operations at Lagos' Murtala Muhammed International Airport. Arik Air officials also accused Aviation Minister Stella Oduah of having a financial interest in seeing the airline fail, but declined to elaborate on the claim. An aviation ministry spokesman denied the allegations and said Arik Air was trying to distract the public from how much money it owed the federal government. Arik Air officials acknowledge that debt and say they make monthly payments to try and resolve it.
Arik Air, a private firm born out of the pieces of country's former national airline, had grown into a major international air carrier in West Africa over the last few years, with direct flights to Johannesburg, London and New York. The airline has more than 20 aircraft in its fleet and ordered more than a dozen new planes. It also provided more flights domestically than any other carrier in Nigeria, a nation of more than 160 million people.
Despite a series of fatal crashes over the last decades, air travel remains the quickest and safest way to travel across Nigeria, a nation about twice the size of California. The nation's road network, a series of decrepit highways that have some of the worst fatality records in the world, remain littered with axle-busting potholes, filled with speeding drivers and preyed upon by gangs of armed bandits. Nigeria's moribund railroad system, though undergoing repairs, remains woefully unable to provide a legitimate alternative for travelers.
Arik Air has said it will rebook passengers on flights when it begins flying again, though the company has not given a date when it will resume its domestic operations.
For passengers like Amina Maikori, who found herself stranded Thursday at the Lagos airport while trying to fly to Abuja, Nigeria's capital, it meant rebooking her ticket on Aero Contractors and waiting for a later flight.
However, even that flight ended up leaving the airport three and a half hours late without explanation, she said, something she just had to accept with a shrug.
"I think it's more frequent here than anywhere else," Maikori said.
Jon Gambrell can be reached at www.twitter.com/jongambrellAP .