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By Agatha Chitumu, Abuja
DAILY COURIER - The Nigeria Deposit Insurance Corporation (NDIC) has again reiterated its resolve to remain steadfast in its mission in order to protect depositors and collaborate with the Central Bank of Nigeria (CBN) in ensuring the stability of the banking sector.
The Managing Director/CEO, NDIC, Bello Hassan stated this in Lagos at a workshop organized for Business Editors and the Finance Correspondents Association of Nigeria (FICAN).
The theme of the 2024 edition is: "Strengthening Nigeria's Financial Safety-Net - The Role of Deposit Insurance."
Describing the workshop as timely, and relevant, Bello noted that it was coming at a time the country’s financial system continues to evolve and face new challenges.
The workshop, according to him, is designed to enrich participants' understanding of the NDIC's role in maintaining financial stability and protecting depositors, with presentations covering key issues that shape the Corporation's activities and consumer protection.
He said, “the NDIC remains steadfast in its mission to protect depositors and collaborate with the Central Bank of Nigeria (CBN) in ensuring the stability of the banking sector, which is critical to the growth and development of the economy.
He added that over the years, the NDIC has been instrumental in promoting stability by ensuring that when banks fail, depositors are protected, and their funds are reimbursed promptly.
“As you may be aware, the NDIC was established over three decades ago to protect depositors, especially the most vulnerable, and to contribute to the stability of the financial system. Our core
the mandate includes providing deposit insurance cover to depositors of licensed banks, supervising insured financial institutions, resolving distressed banks, and ensuring orderly resolution in the event of bank failure.
On the recent closure of Heritage Bank, following the revocation of its license by the CBN on June 3, 2024, he noted that the decision underscored the NDIC's critical role in safeguarding depositors in accordance with the relevant provisions of the Banks and Other Financial Institutions Act (BOFIA) 2020 and the NDIC Act 2023.
Bello stated further: “In the discharge of this critical role of depositor reimbursement, the
Corporation began the payment of the insured deposits of N5 million maximum per depositor within a record time of four days after the bank's closure. This was achieved using Bank Verification Numbers (BVN) as a unique identifier to locate depositors' alternate accounts in other banks without the need to fill forms or visit the NDIC offices.
“This innovative approach has indeed enabled the payment of 84.98% of depositors with BVN linked accounts to date. The prompt payment of depositors, coming at a time when the Corporation had also recently increased the deposit insurance coverage from N500,000 to N5 million in Deposit Money Banks, significantly cushioned the negative impact of bank failure, especially during the current challenging economic climate.
He thereafter lauded the media and civil society groups, alongside corporate affairs managers of banks, for roles played in advocating for the effective implementation of the deposit insurance system.
“Through your efforts, the achievements of the NDIC have become more visible and better understood, reinforcing the Corporation's enduring impact in contributing to the stability of the financial system. By working together, we can continue to build a more resilient financial system that protects the interests of all stakeholders.” He added.
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