THE Nigeria Deposit Insurance Corporation (NDIC) says it provided deposit insurance coverage to 33 Deposit Money Banks (DMBs) made up of 24 commercial banks, six Merchant Banks, three Non-Interest Banks as well as 882 Microfinance Banks (MFBs) 34 Primary Mortgage Banks (PMBs), three Payment Service Banks (PSB) and 30 Mobile Money Schemes as at December 31, 2021.
During the opening ceremony of a retreat for the Senate Committee on Banking, Insurance & Other Financial Institutions organised by the NDIC on Saturday, June 11, in Lagos, the Deputy Director, Research Department, NDIC, Kabiru S. Katata, stated that in addition to the insurance coverage, the Corporation established a Special Insured Institutions Department to supervise the MFBs and Primary Mortgage Banks in order to promote confidence and protect depositors in that sub-sector.
However, the Corporation identified long drawn-out litigation by erstwhile shareholders/directors of closed banks and cumbersome judicial process as some of the challenges facing deposit insurance in Nigeria.
The stakeholders’ retreat of the committee with the NDIC had the theme, ‘Deposit insurance in Nigeria – re-strategising for tomorrow.’
Earlier in his opening remarks, Managing Director/Chief Executive, NDIC, Mr Bello Hassan, said the Corporation has enhanced collaboration with relevant stakeholders like National Assembly, Federal Ministry of Finance, Budget and National Planning, the Judiciary and the CBN on almost all relevant activities.
He said NDIC is also active on the global scene and have therefore embarked on robust collaboration and cooperation with other deposit insurance agencies and global bodies, particularly in the area of knowledge and information sharing.
The aim of these efforts, he added, is to effectively address the technological, legal, regulatory and supervisory challenges facing the deposit insurance system.
Represented by Executive Director of the corporation, Mr Mustapha Muhammad Ibrahim, Hassan observed that the NDIC, has, as its public policy objectives, to protect depositors by providing a mechanism for reimbursing them in case of imminent or actual failure of insured institutions; to contribute to the financial system stability in its role as a key participant in the financial safety-net and to enhance public confidence and systemic stability by providing a framework for the resolution and orderly exit mechanism for failing and failed insured institutions.
“The sustainable growth of any economy whether developing or developed would largely depend on the resilience and stability of its financial sector. As you are aware, financial stability is about the resilience of the financial system to stress, macroeconomic shocks, or problems at a specific institution or market, from disrupting the broader financial system.
“Maintenance of financial resilience therefore, requires preparation, in advance, through diligent planning, laws, robust policies and sound institutions to implement the laws and policies,” Bello noted.
Similarly, Senator Uba Sani, Chairman, Senate Committee on Banking, Insurance & other Financial Institutions, said the theme of the retreat is apt, timely and clearly indicates the willingness of all towards aligning to the changing dynamics and evolution in the banking and financial sectors largely occasioned by rapid technological innovations and how best to effectively guarantee the safety of deposits in insured institutions for prosperous growth and development of the economy at this critical period in tandem with global financial trends and realities.
“As you all know, the Committee in its efforts towards regularly engaging critical stakeholders in the financial and banking sectors jointly organises retreats of this nature for discussion and painstaking analysis on a wide range of issues whose outcome will be of great benefit to the sectors and the Nigerian economy at large,” Sanni, who was represented by Senator Olubunmi Adetunbi, stated.
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