Following the revocation of licenses of Microfinance Banks (MFBs) and four Primary Mortgage Banks (PMBs), the Nigeria Deposit Insurance Corporation (NDIC) has paid over N1.7 billion to insured customers of the failed banks.
The Managing Director/Chief Executive Officer of NDIC, Mr Bello Hassan stated this on Saturday at the 2023 NDIC Editors Forum in Lagos, with the theme: "Stocktaking of Deposit Insurance Practice: Assessing the Past, Evaluating the Present and Forecasting the Future.”
Hassan recalled that earlier in the year, the Central Bank of Nigeria (CBN) revoked the licenses of 183 institutions comprising microfinance banks and primary mortgage banks.
He noted that after the revocation of licenses, NDIC quickly advertised and informed the affected depositors to get the required documents and come forward for verification so that their insured money would be paid to them.
"In terms of insured amount, we have paid more than 1.7 billion to more than 22,000 customers and we are calling on those customers that had no Bank Verification Number (BVN) attached to their accounts to come forward to get their claims verified so that we can pay them the insured amount.
“We are still on that. I’m using this opportunity to appeal to those depositors to come forward so that they can be verified and their claims paid," he said.
Insured deposit is the first claim that NDIC pays to depositors upon revocation of a bank’s licence by the CBN.
But the maximum specified limits for the MFB and PMB sub-sectors are N200, 000 and N500, 000 per depositor per bank, respectively.
Hassan noted that the Deposit Insurance System (DIS) implemented by the corporation is an important component of the nation’s financial safety net.
He said that NDIC's operations focused on minimising banks’ risks and failures through strict banking supervision, reimbursement of insured depositors in the event of failure and orderly liquidation of failed banks.
This, he said complimented the efforts of the CBN to achieve a secure and stable banking system, as well as support the fiscal authority in maintaining stability within the broader financial system that serves as the foundation for economic growth and development.
Hassan pointed out that NDIC like other financial safety net players in Nigeria, had been faced with similar challenges that impacted the nation’s financial system.
He maintained that the challenges were caused by two main factors such as macroeconomic factors and the changing dimensions of the financial services industry.
The MD said though some of the challenges are universal, that others are unique and domesticated.
He disclosed that NDIC aligned itself with CBN's efforts towards strengthening the banking industry through enhancing prudential thresholds and other regulatory instruments.
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