Mohammed Shosanya

The Securities and Exchange Commission has granted two Digital Assets Exchanges “Approval-in-Principle” to commence operation under the Accelerated Regulatory Incubation Program, ARIP.

The companies granted approval are Busha Digital Limited, Quidax Technologies Limited.

The development is in furtherance of SEC’s commitment to enabling innovation that would deepen the capital market while guaranteeing the protection of investors,

In a statement in Abuja Thursday, the Commission said the cohort comprises of two (2) Digital Asset Exchanges, four (4) Digital asset Offering Platforms and one (1) Digital Asset Custodian.

The SEC said: “Busha operates a digital exchange that facilitates the buying and selling of crypto assets with fiat currency. It enables individuals and businesses in Nigeria and other developing economies to access basic digital asset investment services. Busha’s customers use the mobile and web applications to buy, sell, store, send, receive, trade and invest and make payments in cryptocurrencies.

“Quidax Technologies Limited operates a cryptocurrency trading platform in Nigeria. The platform leverages blockchain technology to list and trade already issued crypto tokens (assets).

“Services are provided via a proprietary blockchain owned and controlled by Quidax. The exchange platform is both web and mobile enabled for ease of access and use.

“Quidax also utilizes digital wallet to enable its users store, receive and transact in variety of cryptocurrencies”.

Besides,five firms have been admitted to test their models and technology under the SEC’s Regulatory Incubation Program, RI. They are Trovotech Ltd, Wrapped CBDC Ltd, HousingExhange.NG Ltd, Dream City Capital and Blockvault Custodian Limited.

The SEC recently introduced the ARIP to strategically on-board firms which had commenced operations prior to the release of the Rules on Virtual Asset Service Providers in May 2022. Conversely, the RI Program was created to assess the business models of Digital Assets firms and test innovative products, services and technology in a real-time market environment under close supervision by the SEC.

According to the Commission, “Specifically, the current cohort of the ARIP and the RI Program is characterized by the increased use of distributed ledger technology [“DLT”] in creating and trading crypto assets The outcome of the process would inform further policy development in this space. Tests would be conducted on a short-term and small-scale basis and the SEC would continue to work with the participating firms to agree on testing parameters as well as robust consumer safeguards.

“The referenced Approvals-in-Principle are a precursor to the grant of full registration by the SEC and are meant to ensure that appropriate protection and transparency is in place in respect of each product or service”.

The SEC further stated that: “It is noteworthy that the above firms are not the only entities that have applied to ARIP and the RI Program. Other applications received are being assessed and would be granted Approval-in-Principle on a case-by-case basis as they meet all SEC requirements.

“The SEC uses this medium to reiterate that only approved digital exchanges and platforms are legally authorized to carry out the business of crypto trading in any form in Nigeria. In this regard, the ARIP and RI remain the only avenues for well-intentioned entities to legitimately introduce their digital products and services to the Nigerian Capital market”.

The Commission advised the public to refrain from dealing with illegal operators who have not applied to and received the SEC’s approval under the ARIP or the RI Program.

“Intending investors are also reminded to always confirm from the various SEC information portals whether entities purporting to provide investment services are legally empowered to so do” The SEC added.

Mohammed Shosanya

The Nigerian Deposit Insurance Corporation (NDIC) is making moves to approach a Federal High Court to grant the order to dissolve 87 microfinance banks and primary mortgage banks in the county.

This will happen at the expiration of its notice released on August 23, 2024,the Corporation disclosed this in a statement titled “Notice of intention to terminate liquidation activities” .

“NOTICE is hereby given to the General Public that the Nigeria Deposit Insurance Corporation (NDIC), in its capacity as the Liquidator of the under-listed closed Microfinance Banks and Primary Mortgage Institutions, in accordance with the provisions of its enabling law and other relevant laws, will at the expiration of thirty (30) days from the date of this publication present an application to the Federal High Court to obtain dissolution orders of the closed banks and to release/discharge Corporation as Liquidator of the banks”,the statement read.

The reasons for its actions include the fact that the affected banks were either not located or embarked on self-liquidation.

According to the banking type, 62 of the affected financial institutions are microfinance banks while 25 are primary mortgage banks. 80 of these institutions had their licences revoked because they were not located. The balance, 8, embarked on self-revocation.

16 of the affected banks are located in Abuja, the Federal Capital Territory (FCT) while 51 are local in Lagos State, the nation’s commercial capital, according to the NDIC list.

NDIC said,Rivers State has five affected microfinance banks, Kogi State three, and two each in Bayelsa and Delta states. The two affected microfinance banks in Edo State are Cubic Microfinance Bank and Lofty Height Microfinance Bank. Akwa Ibom, Kwara, Ondo, Osun and Oyo states have one affected bank each.

Mohammed Shosanya

The Nigeria Deposit Insurance Corporation has disbursed the insured deposits of N5 million each to 82.36 per cent of the total customers of the defunct Heritage Bank.

It said that 17.64 per cent of the insured deposits is still pending payment mainly belong to depositors with accounts that have Post-No Debits instructions or lack a Bank Verification Number.

This was announced in a statement signed by the Director, Communication and Public Affairs, Bashir Nuhu, on Sunday in Abuja.

The Central Bank of Nigeria,had on June 3,2024 revoked the banking license of Heritage Bank Plc due to persistent financial instability and regulatory breaches.

In a statement issued on Sunday,Nuhu disclosed that disbursement to affected customers started four days after the liquidation.

He added that this feat was achieved using Bank Verification Numbers as a unique identifier to locate depositors’ alternate accounts in other banks.

The statement said: “In the discharge of its deposit guarantee mandate, the Corporation began the payment of the insured deposits of N5m maximum per depositor within a record time of four days of the bank closure.

“This was achieved using Bank Verification Numbers as a unique identifier to locate depositors’ alternate accounts in other banks.

“This unprecedented achievement of direct payment through BVN-linked alternate accounts without the need for depositors to visit NDIC offices or fill out forms marks a historic shift for the NDIC in the prompt reimbursement of depositors with payment of about 82.36 per cent of the total insured deposit to date.”

For depositors with more than N5m, the director explained that the remaining balances (classified as uninsured deposits) would be paid as liquidation dividends upon realization of the defunct bank’s assets and recovery of debts owed to the defunct bank.

“It is instructive to state that, the remaining 17.64 per cent of the insured deposits yet to be paid were largely depositors whose accounts have post no debits instructions or have no BVN. Others are those with no alternative accounts in other banks or accounts with a KYC limit on the maximum lodgment per day and are yet to come forward for verification.

“However, depositors with balances exceeding Five Million Naira have been paid the initial insured sum of Five Million Naira, while the remaining balances (classified as uninsured deposits) will be paid as liquidation dividends upon realization of the defunct bank’s assets and recovery of debts owed to the defunct bank,” the statement added.

Mohammed Shosanya

The Nigeria Deposit Insurance Corporation,says it already commenced the process of disposing of the physical buildings of the liquidated Heritage Bank Limited.

It disclosed that it also set the process in motion to make sure that it recovers the loans and advances that were granted the bank.

Bello Hassan, the Managing Director of NDIC,who disclosed this on Sunday in Abuja,also said account name discrepancies in Bank Verification Number (BVN) linked alternate accounts of some defunct Heritage Bank customers is delaying the payment of their insured deposits.

He said the corporation had paid substantial amounts to depositors of the defunct bank without BVN account linked issues.

He advised depositors of the bank who were yet to receive their insured deposit credit alert to visit the NDIC’s website and complete their verification forms for their payment.

He said the verification would also include depositors without BVN alternate account.

NDIC,he noted,has already commenced the payment of customers since June 6.

”We have paid a substantial amount to the customers.What we leverage in making the payment is BVN of customers. We trace alternate accounts in other banks and pay them their insured amounts.

”There are some that we have challenges linking up because of some discrepancies between the names and others.We are calling on customers that have not received their alerts in their alternate accounts to come forward and complete their verification forms so that we can pay them,” he said.

Speaking on payment of depositors with more than five million naira with the bank, Hassan said they would be paid liquidation dividend.

He added:”That is what we use in paying those liquidation dividends.We are not going to wait until we recover everything.

”As we recover, we will also advertise to say that we will pay liquidation dividends so that concerned depositors will be on the lookout for alerts in their accounts,” Hassan said.

The Central Bank of Nigeria on June 3 revoked the banking licence of Heritage Bank Plc.

The apex bank explained that the decision was made due to the bank’s failure to improve its financial performance, posing a threat to financial stability.

Mohammed Shosanya

The Nigeria Deposit Insurance Corporation (NDIC) on Thursday announced the approval of a 3 increase in the maximum deposit insurance coverage levels for all licensed deposit-taking financial institutions.

Mr. Bello Hassan, Managing Director and Chief Executive of NDIC made the announcement at a press conference on the review of the maximum deposit insurance coverage level, in Abuja, saying the policy takes immediate effect.

According to Hassan, details of the adjustments are that: for the ‘Deposit Money Banks (DMBs): The increase of the maximum deposit insurance coverage from N500,000 to N5,000,000, would provide full coverage of 98.98% of the total depositors compared with the current cover of 89.20%. In terms of the value of deposit covered, the revised coverage would increase the value of deposits covered by deposit insurance to 25.37% compared with the current cover of 6.31% of total value of deposits.

“ii. Microfinance Banks (MFBs): The increase of the maximum deposit insurance coverage from N200,000 to N2,000,000, would provide full coverage of 99.27% of the total depositors compared with the current level of 98.76% and would increase the value of deposits covered by deposit insurance to 34.43% compared with 14.38% of total value of deposit, currently covered.

“Primary Mortgage Banks (PMBs): The increase of the maximum deposit insurance coverage from N500,000 to N2,000,000 would provide full coverage of 99.34% of the total depositors compared with the current 97.98% and would increase the value of deposits covered by deposit insurance to 21.04% compared with 10.77% of total value of deposit, currently covered.

“Payment Service Banks (PSBs): The increase of the maximum deposit insurance coverage from N500,000 to N2,000,000 would provide full coverage of 99.99% of the total number of depositors and would increase the value of deposits covered by deposit insurance to 43.10% of the total value deposits from the current cover of 40.60%.

“Subscribers of Mobile Money Operators: The increase of the maximum Pass-through deposit insurance coverage from N500,000 to N5,000,000 per subscriber per MMO as the applicable coverage level for depositors of DMBs. 4 7.0 I must emphasise that, the revised deposit insurance coverage has balanced the NDIC’s goals of deposit protection and financial system stability with incentives for depositors to practice market discipline and prevent banks from unnecessary risk-taking and moral hazard. Consideration was given to ensure that the coverage was limited but adequate enough to protect a large number of depositors and credible enough to prevent the destabilizing effect of bank runs” he said.

He reiterated that the Corporation’s mandate of Deposit Guarantee is a critical component of depositors’ protection, as it guarantees the payment of deposits up to a maximum set limit in the event of bank failure.

According to him,the deposit guarantee, covers depositors of all deposit taking financial institutions licensed by the Central Bank of Nigeria, which includes Deposit Money Banks (DMBs), Microfinance Banks (MFBs), Primary Mortgage Banks (PMBs), Non-Interest Banks (NIBs), Payment Service Banks (PSBs) and subscribers of Mobile Money Operators.

He said the maximum deposit insurance coverage is determined through periodic research based studies, to ensure its adequacy and credibility, adding that various factors considered in setting the coverage level are; deposit distribution, impact of inflation, per capita GDP, exchange rate and other statistical models, among others.

According to him,the adoption of the revised maximum deposit insurance coverage is supported by the Corporation’s current funding, represented by the balances in the various Deposit Insurance Funds (DIFs), expected annual premium collection, enhanced supervision that would reduce the likelihood of bank failures, effective bank resolution frameworks and other funding arrangements provided by the NDIC Act No. 33 of 2023.

Mohammed Shosanya

The Nigeria Deposit Insurance Corporation (NDIC),has reiterated its stance of zero tolerance for corruption, which is further strengthened by the inauguration of the Corporation’s Anti Corruption and Transparency Unit (ACTU) by officials of the Independent Corrupt Practices and Other Related Offences Commission (ICPC) at the NDIC headquarters in Abuja.

The MD/CE, NDIC Mr. Bello Hassan, emphasized the Corporation’s to core values of team work,respect,fairness, integrity,professionalism, and passion during the event.

Represented by the NDIC Executive Director, Operations, Mr Mustapha M Ibrahim during the inauguration, the NDIC boss said the ACTU has strengthened the Corporation’s operational system through the implementation of various compliance measures to ensure ethics, integrity, transparency and accountability in the workplace.

He explained that the specific measures include robust internal controls,regular risk assessments, strict adherence to regulatory guidelines, and comprehensive training programs for employees.

Mr. Hassan described the inauguration as a significant step in the Corporation’s ongoing commitment in the fight against corruption and enhance transparency.

He emphasised that NDIC management remains committed to supporting ACTU activities, recognizing the unit’s critical role in ensuring the Corporation’s operations are conducted with integrity, free from corruption, and fostering public trust

The ICPC Chairman, Dr. Musa Adamu Alryu who was represented by ICPC Acting Director System Study and Review, Mr. Olusegun Adigun, praised NDIC Management for their dedication and active support in establishing and advancing the activities of the ACTU to address corruption issues and foster ethical practices.

He commended the efficiency and diligence of the NDIC ACTU in fulfilling its mandate, resulting in the Corporation retaining the first position for two consecutive years on the annual ICPC ethics and integrity compliance scorecard.

He urged the new ACTU members to see their nomination as an opportunity to build on the good legacies of the previous members and to complement Management’s efforts in promoting the core values of the Corporation through their assigned duties.

He stressed the need for the NDIC Management to sustain its commitment and support to ACTU so that the Unit can perform optimally and remain a veritable tool in embedding laid down ethical standards amongst staff and sustaining a positive image for the Corporation.

Bashir Nuhu, Director of Communication and Public Affairs in a statement noted that 10 members of staff were sworn in as members of the NDIC ACTU during the inauguration.

He listed the key functions of NDIC ACTU member to include annual sensitization of staff against corruption; conduct of system study & review and corruption risk assessment to strengthen internal systems, monitoring budget implementation of the corporation, coordinating whistleblowing platforms, identifying and rewarding outstanding members of staff amongst other responsibilities.

Mohammed Shosanya

Nigeria Deposit Insurance Corporation (NDIC),has pledged to continue to collaborate with the Central Bank of Nigeria (CBN) to ensure the resilience and stability of the Nigerian banking sector.

The Managing Director/Chief Executive of NDIC, Mr Bello Hassan who was represented by the Zonal Controller, Mrs Pamela Roberts, stated this on Friday during the NDIC special day at the 35th Enugu International Trade Fair.

He said: “In light of the ongoing global economic dynamics, the Central Bank of Nigeria (CBN) has stepped up regulatory efforts to ensure the resilience and stability of the Nigerian banking sector. A significant stride in this direction is the revision and pegging of higher minimum capital requirements for banks operating in Nigeria.

“Under this proposal, commercial banks would be required to maintain minimum capital levels of N500 billion, N200 billion, and N50 billion for International, national, and regional institutions, as well as N50 billion for merchant banks while national and regional non-interest banks are required to maintain N20 billion and N10 billion respectively.

“This strategic recapitalization initiative is in line with President Bola Ahmed Tinubu’s administration urge to grow Nigeria’s economy to the ranks of $1 trillion based economies. This will not only strengthen the banking system but would also enhance the sector’s ability to withstand financial shocks.

“As ever NDIC will continue to collaborate with the CBN in ensuring a seamless transition while safeguarding depositors interest,” he said.

He stated further that the NDIC has been unwavering in its commitment to promptly reimburse depositors affected by bank failures noting “Since the Central Bank of Nigeria (CBN) revoked the licenses of 179 Microfinance Banks and 4 Primary Mortgage Banks in 2023, the NDIC has continued to efficiently disburse insured sums to verified depositors of these closed institutions.

He said: “Notably, depositors who have undergone verification and have provided alternative account details have received their payments seamlessly within a record period of 5 working days.

“While It’s worth noting that depositors with amounts exceeding the insured limit will receive liquidation dividends once debts are recovered and assets of the closed banks are Disposed. Moreover, the NDIC strongly encourages depositors of the affected banks to come forward with their Bank Verification Number (BVN), proof of account ownership, proper identification, and/or alternative account details. Various channels are
available for claims, including visiting nearest NDIC offices in person,” he said

ECCIMA’s President Sir Odeiga Jideonwo,in his address,said NDIC remains a great confidence back up for Nigerian teeming depositors who had hitherto suffered dearly in the past prior to the establishment of NDIC by losing all their deposits whenever tsunami occurred in the banking sector with banks closing their doors permanently against depositors.

He commended NDIC for the role they are playing towards building confidence among bank depositors thereby helping to grow the Nigerian financial sector.