Chimara BygoldThe present coverage limit of N500,000 under the Nigeria Deposit Insurance Corporation (NDIC) guarantee, fully covers over 97per cent of depositors and engenders confidence in the Nigerian banking sector.
Managing Director/ Chief Executive Officer NDIC, Hassan Bello, who disclosed this over the weekend at the 2021 edition of the NDIC/Editors forum in Lagos added that the Corporation’s accomplishment in the payment of guaranteed sums and liquidation dividends speaks volumes of its commitment to the discharge of its unique mandate. His words: “NDIC had paid a cumulative sum of ₦8.3billion to 443,946 insured depositors and ₦100.1 billion to uninsured depositors of Deposit Money Banks (DMBs) in-liquidation as at 30th September 2021 while N3.4 billion was paid to 90,945 insured depositors of microfinance banks and ₦1.2 million to uninsured depositors.”
He also said that the corporation has commenced the review of its approach to the determination of premium/contribution by banks to Deposit Insurance Fund(DIF) to a more risk-based approach to ensure that, the probability of the risk crystallizing becomes a major factor in the pricing methodology of premiums going forward.
On timely support to insured institutions, he stated that NDIC has identified the need to reconsider its criteria for qualification of insured financial institutions, to provide realistic terms and conditions that will facilitate prompt access to the Corporation’s technical and/or financial support in line with section (2)(1)(b) of the NDIC Act, 2006 whilst also protecting the Corporation from possible down side risk.
“We have commenced the process of strengthening our failure resolution and liquidation mandate, through the improvement of our internal processes and procedures as well as enhancing effective collaboration with relevant stakeholders, to ensure that the Corporation discharges its responsibilities more efficiently,” Bello emphasized.
In the same vein, he said the cumulative insured amount paid to 1,553 depositors of closed primary mortgage banks as at 30th September, 2021 stood at N110.2 million while ₦7.9 million was paid as uninsured deposits.
Most importantly, the payment of N1.3 billion to 991 creditors and ₦4.9 billion to 965 shareholders of banks in-liquidation as at 30th September 2021 underscored the Corporation’s success story in bank liquidation he stated.
What this implies is that the Corporation had realised enough assets to pay all the insured and uninsured depositors of the banks that presented themselves for payment.
Currently, 19 out of the 49 DMBs in-liquidation fall into this category. In all the foregoing, he said NDIC is very mindful of the need to foster stronger collaboration with publishers and senior Editors of media organisations.
“Through Better understanding of our programmes and policies, it is believed that you will assist our other stakeholders to gain the right insight into the role of the NDIC as a member of the financial safety net and the contributions of DIS to the stability of the nation’s financial system.
“I therefore call on you to continue to support the Corporation in its resolve to effectively discharge its core mandates.
“On our part, we promise to keep our doors open to your suggestions and observations, while partnering with you on capacity building and other areas of mutual benefit,” the NDIC’s boss stated.
He further said that the theme of this year’s workshop: “Enduring Extreme Disruptions: Resilience & Reinvention for Banking System Stability & Deposit Insurance,” cannot be more apt.
As economies across the globe continue to grapple with the devastating impact of the COVID-19 Pandemic, Bello said it has become expedient and highly desirable for supervisory agencies, to come up with appropriate strategies for building resilience into the financial system, while also reinventing the policies that define its workings as the corporation seeks to provide the much-needed support to the Federal Government’s economic recovery agenda.
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