NDIC Increases Maximum Deposit Insurance Coverage For Financial Institutions

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.

NDIC Amplifies Crusade Against Graft,Inaugurates Anti-corruption,  Transparency Unit

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.

NDIC Pledges Improved Partnership With CBN To Strengthen Banking Sector

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.

Minister Scores NDIC High On Depositors’ Protection

Mohammed Shosanya

The Minister of State for Youth Development, Mr Ayodele Olawande,has commended the Nigeria Deposit Insurance Corporation (NDIC) for its significant achievements in safeguarding depositors from the adverse impacts of bank failures.

Bashir Nuhu,the Director, Communication and Public Affairs,who revealed this in a statement,said the Minister commended NDIC for consistently supporting the Central Bank of Nigeria (CBN) in overseeing the banking sector and contributing to the stability of the nation’s financial system.

The Minister gave the commendation during a courtesy visit to the Management of the Corporation in Abuja.

He said his ministry was ready to collaborate with the Corporation to further deepen and expand public awareness on the mandate and activities of the NDIC especially among youth and unbanked populations in rural areas through the Ministry’s Nigerian Youth Academy (NIYA) initiative as a veritable tool for financial inclusion.

He explained that NIYA is a response to the Presidential mandate to the ministry aimed at unleashing the creative potential of Nigerian youth for employment generation and wealth creation.

He described NIYA as a digital market place connecting Nigerian youth, both domestically and in the diaspora, to showcase their creativity, acquire relevant skills, and secure employment opportunities aligned with their life ambitions.

With the slogan “one youth, two skills, one local government, one product,” the initiative aims to empower seven million youths with transformative skills.

It features components such as online classes, job fairs, and access to resources and funding.

Besides,the Ministry is partnering with agencies mandated for skills acquisition and empowerment to achieve its objectives.

Speaking,the Managing Director/Chief Executive of the Corporation, Mr. Bello Hassan, who was represented by the Executive Director (Operations), Mr. Mustapha Ibrahim, commended the ministry for the initiative Mr Ibrahim highlighted NiYA’s potential enhance capacity building and empower Nigerian youths, fostering business activities, entrepreneurship, and wealth creation.

He noted that this aligns with NDIC’s objectives of promoting financial inclusion and strengthening public confidence in the nation’s financial system.

He emphasised that the initiative would create an enabling environment for Nigerian youth to thrive and contribute meaningfully to the nation’s development.

Depositors Of Liquidated Banks Fail To Claim N16.18B Dividends,Says NDIC

Mohammed Shosanya

Nigeria Deposit Insurance Corporation (NDIC),Thursday says 20 failed banks depositors across Nigeria are yet to claim N16.18 billion liquidation dividends accrued to them.

Its Managing Director and Chief Executive of the NDIC, Bello Hassan,who disclosed stated this at the NDIC Day at the Kano 44th International Trade Fair, held in Kano,implored the depositors of the closed banks to come forward for verification and payment of their deposits that are in excess of the guaranteed sums.

He listed the liquidated banks to include, Liberty Bank, City Express Bank, Assurance Bank, Century Bank, Allied Bank, Financial Merchant Bank, Icon Merchant Bank, Progress Bank, Merchant Bank of Africa (MBA), Premier Commercial Bank, North South Bank, and Prime Merchant Bank.

Others affected banks on the list are: Commercial Trust Bank, Cooperative and Commerce Bank, Rims Merchant Barik, Pan African Bank, Fortune Bank, All States Trust Bank, Nigeria Merchant Bank, and Amicable Bank in-liquidation.

Mr. Hassan,who was represented by Hajiya Rakiya Imam urged relevant stakeholders to visit any NDIC office or access the claims page on its website, www.ndic.gov.ng, to download, complete, and submit the verification form along with the prescribed supporting documents.

He said that submissions should be sent to the dedicated email: claimscomplaints@ndic.gov.ng.

Mrs Imam further stated that recently, following the revocation of licenses for 179 Microfinance Banks (MFBs) and 4 Primary Mortgage Banks (PMBS) by the Central Bank of Nigena (CBN), the NDIC immediately commenced liquidation of the banks and began disbursing insured sums to depositors within just 7 days of the closure of these banks.

” It’s Important to note that out of these, the NDIC has paid One Point Five Nine Five Billion Naira (N1.595 billion) to Forty-One Thousand and Thirty-Four (41,034) depositors of 129 MFBs and 3 PMBS, Payments are still ongoing and depositors with funds exceeding the insured limit will receive liquidation dividends after recovery of debts and sale of physical assets of the closed banks.

“Ladies and gentlemen, it is imperative to note that in the unfortunate event of bank failure, the current insurance coverage for depositors varies across different banking institutions.

” While depositors of Deposit Money Banks (DMBs), Primary Mortgage Banks (PMBs), Non-Interes: Banks (NIBs), Payment Service Banks (PSBS), and subscribers of Mobile Money Operators (MMOs) are insured up to a maximum limit of N500,000 per depositor per bank, for depositors of Microfinance Banks (MFBs), the maximum insurance limit stands at N200,000 per depositor per bank.

“These Insured limits undergo periodic reviews by the Board of the Corporation, ensuring comprehensive coverage for the majority of depositors. Furthermore, depositors holding balances exceeding the insured sums receive regular payments of the excess in the form of liquidation dividends, that also extends to the benefit of creditors and shareholders of the respective banks,” she added.

Nigeria Needs Bigger,Stronger Banks To Achieve $1trn Economy,Says NDIC

Mohammed Shosanya

Nigeria needs bigger banks to achieve the vision of a $1 trillion economy,the Nigeria Deposit Insurance Corporation, NDIC.

Managing Director of the corporation,
Mr. Bello Hassan,who stated this in Owerri, Imo State, while addressing journalists on the sidelines of the annual workshop organised by the corporation for Business Editors and Finance Correspondents,also said the proposed recapitalization of banks by the Central Bank of Nigeria was in order.

He said while the banking industry is sound in terms of key indicators namely Capital Adequacy, Liquidity, Earnings and Quality of Assets, achieving a $1 trillion economy requires bigger banks.

He added: “I know as we speak if you look at the performance of the industry, it is very sound, looking at the key financial soundness indicators, capital adequacy, liquidity, earnings, and quality of assets.

“But, certainly, the government is trying to grow our GDP to $1 trillion, we also need bigger banks to play in that space.

“As the government is trying to implement their agenda of growing the GDP to $1 trillion we also need bigger banks to achieve that. I believe it is within that context that the CBN is recapitalising the banks, asking the banks to recapitalise, to enhance their capital.”

NDIC Clarifies Report On Liquidation Of 20 Banks

Mohammed Shosanya

The Nigeria Deposit Insurance Corporation (NDIC),has described as misleading the recent misleading news reports circulating on various social media platforms under the headline “CBN Liquidates 20 Banks – NDIC (Names).”

The NDIC gave clarification in a statement signed by Bashir Nuhu, the Director, Communication and Public Affairs.

It said that contrary to the misleading headline,NDIC clarifies that the 20 banks mentioned in those reports were among the banks that had been previously closed due to the revocation of their operating licenses by the Central Bank of Nigeria (CBN) between 1994 and 2018.

It added:”The general public should be aware that the NDIC has fulfilled its commitment by paying the guaranteed sums owed to depositors.

“Additionally, the Corporation has made cumulative payments of liquidation dividends totalling N45.45 billion as of July 2023, representing amounts exceeding the guaranteed sums to depositors of the 20 banks.

“In light of further recoveries from debtors of the liquidated banks, the Corporation has announced an additional N16.18 billion in liquidation dividends to be paid to depositors, creditors, and shareholders of the 20 banks in liquidation.

“We urge relevant stakeholders to visit any NDIC office or access the claims page on our website, www.ndic.gov.ng, to download, complete, and submit the verification form along with the prescribed supporting documents.

“Submissions should be sent to the dedicated email:claimscomplaints@ndic.gov.ng.

“The closed banks covered by this exercise include Liberty Bank, City Express Bank, Assurance Bank, Century Bank, Allied Bank, Financial Merchant Bank, Icon Merchant Bank, Progress Bank, Merchant Bank of Africa (MBA), Premier Commercial Bank, North South Bank, and Prime Merchant Bank. Others are Commercial Trust Bank, Cooperative and Commerce Bank, Rims Merchant Bank, Pan African Bank, Fortune Bank, All States Trust Bank, Nigeria Merchant Bank, and Amicable Bank in-liquidation.

“It’s important to note that liquidation dividend represents the amount in excess of the insured sums paid by the NDIC to depositors of a closed bank.

“This amount is derived from recoveries made from the realization of assets of failed financial institutions and covers payments to creditors and shareholders after the full payment to depositors of the defunct bank”.

NDIC Leads In ICPC’s Ethics,Integrity Compliance Ratings

Mohammed Shosanya

The Nigeria Deposit Insurance Corporation (NDIC) has secured the top position in the Independent Corrupt Practices and Other Related Offences Commission (ICPC) 2023 Ethics and Integrity Compliance Scorecard (EICS).

Bashir Nuhu, the Director, Communication and Public Affairs, in a statement,explained thatthe development is a remarkable achievement which marks the second time that NDIC has achieved the prestigious first place, previously having been ranked first in the 2021 EICS.

The ICPC’s Ethics and Integrity Compliance Scorecard (EICS) is an annual assessment tool designed to evaluate Ministries, Departments, and Agencies (MDAs) in Nigeria for their adherence to institutional ethics and integrity requirements.

The assessment encompasses the measurement and monitoring of key performance indicators in categories such as Management Culture and Structure, Financial Management Systems, and Administrative Systems,the statement said.

In the 2023 EICS, which took place between March and July 2023 and involved 404 MDAs, the NDIC excelled with a score of 91.30%.

The EICS report emphasizes the ICPC’s commitment to mitigating abuse of office and corruption by promoting ethics and integrity benchmarks within government agencies, ultimately contributing to more effective service delivery.

According to the statement,the NDIC’s consistent first-place ranking is a testimony to the Corporation’s zero tolerance policy for corruption and benchmarking its operations with standard best practices.

It would be recalled that the Corporation in September this year earned 3 ISO Certifications having complied with the requirements following a rigorous audit by MSECB, a leading international provider of Audit and Certification services.

These achievements have been possible due to Corporation’s effective and ethical operational procedures aimed at instilling transparency and accountability. The NDIC’s Anti-Corruption and Transparency Unit (ACTU) played a pivotal role in the process, collaborating closely with the ICPC.

This collaboration included sensitizing NDIC staff, identifying and enhancing internal controls to prevent fraudulent practices, and ensuring strict compliance with established policies and procedures by the Corporation’s management

The NDIC’s outstanding performance in the 2023 ICPC Ethics and Integrity Compliance Scorecard underscores its unwavering commitment to upholding the highest ethical standards and serving as a beacon of integrity within the Public Service. The Corporation remains dedicated to ensuring the safety of deposits and contributing to the stability of the financial system.

Depositors Of Distressed Microfinance Banks Get N1.2bn Refund

Mohammed Shosanya

The Nigeria Deposit Insurance Corporation (NDIC) says it has so far made refunds of N1. 2 billion deposits to some of the 189 Microfinance Banks (MFBs) and the four Primary Mortgage Institutions (PMIs) liquidated by the Central Bank of Nigeria (CBN).

Managing Director/ Chief Executive of NDIC, Hassan Bello,disclosed this on a sideline interview at the 2023 sensitisation seminar organised by NDIC for Federal High Court Judges in Uyo, the Akwa Ibom State capital.

He said that though the Act setting up the corporation provides that payment should be made within 30 days, it has been able to effect payment to insured depositors within seven days.

He said:”So far, we have about N1. 2 billion insured deposits to the depositors in the Microfinance Banks and Primary Mortgage Institutions (PMI).

“We are still paying but why we have not completed payment is that there are some customers that we do not have records of their BVN to identify their alternate bank accounts in other banks.”

The corporation, according to Hassan has also realized N1. 6 billion to pay creditors and depositors of the 20 commercial banks liquidated, even as plans have been concluded to pay them as quickly as possible.

Imploring depositors to come forward with information that would help in the payment of the insured depositors, he expressed satisfaction that corporation was able to achieve speedy payment within seven days .

While addressing the trainees earlier, the Managing Director/ Chief Executive of NDIC, Hassan Bello noted that the judiciary plays a critical role in resolving disputes that evolve from the revocation of banking license all through liquidation and termination of liquidation activities..

He said:”Currently the maximum claim for depositors of Deposit Money Banks, (DMBs) Primary Mortgage Banks(PMBs) Payment Service Banks(PSBs) and subscribers of Mobile Money Operators (MMOs) is N500,000 per depositor, per deposit taking institution, while Micro-Finance Banks(MFB) have a maximum coverage limit of N200, 000 per depositor, per MFB”.

NDIC Boss Urges ICAN To Consider Deposit Insurance System Courses

Mohammed Shosanya

The Managing Director/Chief Executive of the Nigeria Deposit Insurance Corporation (NDIC), Mr. Bello Hassan, has implored the Institute of Chartered Accountants of Nigeria (ICAN) to incorporate courses on the Deposit Insurance System (DIS) into its educational programs and modules.

Bashir Nuhu, the Director, Communication and Public Affairs Department,disclosed this in a statement on Thursday.

He quoted Mr. Hassan as making the call during a courtesy visit by the Governing Council Members of ICAN, led by the President of the Institute, Mr. Innocent Iweka Okwosa, to the Corporation’s Management in Abuja.

He explained that including DIS courses within ICAN’s training programs would enhance the understanding of DIS not only within the banking sector but also among professional accountants.

According to him, it as critical to bridging the knowledge gap on the mandate and achievements of DIS, its critical role in protecting depositors and its contribution to financial system stability.

He said that it would also address misconceptions of the benefits and limitations of the deposit insurance system.

He emphasized the import of public awareness in maximizing the impact and reach of the deposit insurance system throughout the general public and the financial sector as a whole.

He stated that given the novel nature of the scheme in Nigeria and globally, collaboration with ICAN and other stakeholders had become imperative to strengthen the effectiveness of the Corporation’s operations to fully implement its mandate.

Hassan congratulated Mr. Okwosa on his assumption of office as the 59th ICAN President, and encouraged him to ensure that chartered accountants uphold the Institute’s values of accuracy and integrity in all aspects of their work.

He also reassured the Institute of the Corporation’s unwavering support and partnership in furthering the practice of accounting in the country.

He also extended condolences to the Institute on the recent passing of the first chartered accountant in Nigeria, Mr. Akintola Williams who left a legacy of excellence and professionalism that has paved the way for the growth of the profession in Nigeria.

Mr. Hassan commended ICAN’s commitment to maintaining zero tolerance for professional misconduct, asserting that this stance would continue to provide confidence to the Corporation and other stakeholders in relying on the work of accountants in fulfilling their mandates.

In his remarks, Mr. Innocent Iweka Okwosa praised Mr. Hassan for his exemplary leadership and the professionalism he has instilled in the Corporation’s operations.

He noted that under Mr. Hassan’s leadership, the Corporation has made substantial contributions to ensuring the safety and stability of the Nation’s financial system, a crucial element for the growth and prosperity of the Nigerian economy.