The Managing Director of the NDIC, Umaru Ibrahim stated this while addressing the stakeholders on the occasion of the Corporation Special Day at the 2018 Lagos International Trade Fair on Tuesday, November 6, 2018 in Lagos.
The managing director who was represented at the fair by Mohammed Kudu Ibrahim, the Head, Corporate Communications of the Corporation said the defunct Skye Bank plc now Polaris Bank was able to continue banking operations in the 277 branches, with over 6000 staff and depositors have unhindered access to deposits in excess of N949.60billion as at June 2018.
A bridge bank is a temporary bank created to operate a failed bank until a buyer can be found. According to him, the benefits of a bridge bank are not far-fetched: The resolution option is less disruptive to rendition of bank services, unlike outright liquidation or depositors’ payoff. It is also less costly to the entire macro-economy, while staffs are retained in the bridge bank, added he.
Ibrahim disclosed that all those that contributed to the failure of the bank are being investigated by relevant agencies of the government and would be prosecuted to serve as deterrent for others.
“The NDIC has embarked on various public awareness campaigns explaining the role and responsibilities of the customers to their banks, and vice versa. This will essentially instill market discipline on the part of the depositors to ever be more vigilant I n choosing financial institutions to bank with.”
“The NDIC is always delighted to participate in the annual Lagos International Trade Fair because trade fairs are a very powerful marketing/awareness creation medium. It may interest you to know that, the NDIC has come to recognize the Lagos Fair, as a veritable platform to educate the public on its operations. At the fair, we always have the opportunity to showcase our achievements, while offering an avenue to meeting aggrieved members of the public that hitherto have lost their deposits/scarce resources in failed financial institution across the length and breadth of the country.
“The NDIC as a critical member of the Nigerian financial safety-net has the primary objectives of safeguarding bank depositors and promoting public confidence in the entire financial system. Both objectives derive from the NDIC’s core mandates of Deposit Guarantee, Bank Supervision, Distress Resolution, and Bank Liquidation.
“The NDIC has a critical role to play in the successful delivery of the federal government’s Economic Recovery and Growth Plan (ERGP). The corporation has recorded tremendous stride in the implementation of its mandate and in ensuring that the over-riding public policy objectives for establishing a explicit Deposit Insurance System (DIS) in the country are fully realized. As part of it mandate, the NDIC in collaboration with the CBN jointly conduct the examination of banks to ensure that they operate in a safe and sound manner as well as to ensure early identification and timely intervention in problem banks.
Ibrahim said as provided for the in the NDIC Act 2006, when financial institutions fails, depositors of Deposit Money Bank (DMBs), Non-Interest Banks (NIBs) and Primary Mortgage Banks (PMBs) are reimbursed up to a maximum limit of N500 000.00 while the maximum insured coverage for depositors of Micro-Finance Banks (MFBs) is N200 000.00. However, he added, it is important to also stress that depositors who have funds in excess of the insured limits are paid dividends from the liquidation of failed banks depending on the quality of their assets and the outcome of debt recoveries by the NDIC.
The Caption Photo: The Managing Director/ CEO of the NDIC, Umaru Ibrahim