NDIC Pledges to Ensure Stability of Banks

The Nigerian Deposit Insurance Corporation (NDIC) has said it had put in place an effective Risk Based Supervision framework to enable it protect depositors against unethical practices and other infractions in the banking sector.

It also said that an effective distress resolution mechanism had been put in place to protect bank depositors as well as ensure the safety, soundness and stability of the banking system.

Alh Umaru Ibrahim, managing director, NDIC, stated these on Tuesday while speaking at the corporation’s special day during the 10th Abuja International Trade Fair.

The fair with the theme “Entrepreneurship as a panacea for economic growth” was attended by over over 200 local and foreign exhibitors.

He said the corporation, in line with its mandate, had taken steps to ensure confidence in the banking sector, noting that as of December 2014, a cumulative liquidation dividend of N94.73bn had been paid to 250,592 uninsured depositors of 49 closed Deposit Money Banks.

In the same vein, he said within the same period, the corporation had paid a cumulative sum of N6.83bn as insured deposit to 528,277 depositors of 49 closed DMBs.

Represented by Mr. Stanley Balogun, deputy director, Strategy Development Department, NDIC, said, “The corporation continues to conduct risk based supervision in collaboration with Central Bank of Nigeria on the 22 DMBs, 882 Microfinance Banks and 61 Primary Mortgage Institutions.

“It also carries out other critical investigations in order to send strong signal to bank operators against unethical and other infractions prevalent in the banking system.”

He lamented that while the NDIC had been performing its mandate creditably, the plan of the Federal Government to review its act in order to ensure its effectiveness could not be achieved before the end of the seventh National Assembly.

He said if the amendment of the act had scaled through, the corporation would have functioned with greater operational efficiency as a deposit insurer.

In the area of financial and education, Ibrahim said the corporation in partnership with the CBN is promoting initiatives that would ensure easy access to banking services.

These initiatives, he noted, would assist in reducing the percentage of adult Nigerians that do not have access to any form of financial services from 46.3 per cent as of 2010 to 20 per cent by 2020.

Mr. Osi Imomoh, vice president, Finance, Abuja Chamber of Commerce and Industry, who also spoke at the event, called on the NDIC to collaborate with CBN to reduce the interest rate.