I am delighted to be here today on the occasion of the Nigeria Deposit Insurance Corporation, NDIC Special Day at the 24TH Enugu International Trade Fair. Let me first and foremost, congratulate the President and the entire members of Enugu Chamber of Commerce for this edition of the trade fair which has turned out to be a huge success. I would also wish to sincerely welcome our distinguished guests, particularly our royal fathers, other traditional rulers, members of the academic community and gentlemen of the press who found time to be here despite their busy schedules.
Your Royal Highnesses, distinguished ladies and gentlemen, the theme of this year’s trade fair “Positioning the Nation’s Economic Environment as Investment Destination of Choice in Africa and for Effective Global Competitiveness” bears eloquent testimony to the posture of the Chamber as a key player in the quest for the realization of the Vision 20:2020 and the transformation agenda of the Federal Government.
Once more, this trade fair provides a unique platform for bringing together stakeholders from various sectors of the economy such as banking and other financial services, manufacturing, oil & gas and agriculture to discuss and find ways of enhancing investments and business opportunities in Nigeria. For us in NDIC, trade fairs provide unique forum not only to showcase the landmark achievements of the Corporation but also to enhance public awareness on our mandate and activities.
Your Royal Highnesses, distinguished ladies and gentlemen, let me refresh our memories to the fact that the NDIC was established by the Federal Government under the NDIC Decree 22 of 1988 which had been replaced by NDIC Act No. 16 of 2006 to insure deposit liabilities of licensed deposit-taking financial institutions in Nigeria. The key mandate of the Corporation is to provide financial guarantee to depositors of the insured financial institutions in the event of failure with a view to engendering public confidence in the nation’s banking system. Therefore, the NDIC has a crucial role to play towards the safety, soundness and stability of the financial system.
The primary public policy objectives of Deposit Insurance System (DIS) in Nigeria are to protect the interest of small depositors by providing a mechanism for reimbursement to them in the event of imminent or actual failure of banks while ensuring safe and sound banking practices, contributing to an orderly payments system and enhancing fair competition in the banking system. Therefore, the DIS in the country was designed as “risk minimizer” with core functions of deposit guarantee, bank supervision, failure resolution and liquidation of failed insured deposit-taking financial institutions.
It is imperative at this juncture to say that the NDIC has been resolutely committed to its mandate and core functions since it commenced operations in more than two decades. The Corporation has therefore significantly contributed to the various banking reforms that had been witnessed over the years in the Nigerian banking sector. Let me use this opportunity to highlight some of the landmark achievements of the Corporation despite the daunting challenges. It is on record that the NDIC had paid a cumulative sum of N90.13 billion to depositors of 48 deposit money banks (DMBs) in-liquidation as at 31st December, 2012 as against N80.18 billion paid to depositors as at 31st December, 2011, representing an increase of about N10 billion.
Similarly, a total sum of N2.50 billion had been paid to depositors of the 103 closed Microfinance Banks (MFBs) as at 31st December, 2012 as against the sum of N2.25 billion that was paid to the insured depositors of the closed (MFBs) as at the end of December 2011. Furthermore, for the same period, NDIC made cumulative liquidation dividend payment to shareholders of Alpha Merchant Bank, Nigeria Merchant Bank and Pan African Bank (in-liquidation) stood at N373.04 million, N620.0 million and N293.0 million respectively. That was in addition to the settlement of all the depositors and creditors of the three banks for which the Corporation established bridge banks in 2011. Please recall the seamless introduction of 3 bridge banks to save over 3.7 million depositors at erstwhile Afribank Plc, Bank PHB and Spring Bank along with preservation of over 6600 jobs in August 2011.
Distinguished ladies and gentlemen, let me seize this opportunity to inform you all on the current efforts in sanitizing and strengthening the microfinance banks (MFBs) and primary mortgage banks (PMBs) through the revocation of licences of the 103 failed MFBs and 25 PMBs as well as the revision of the microfinance policy framework. The regulatory authorities recently planned to introduce the promotion of financial inclusion initiatives in Nigeria through the agency banking and mobile banking, amongst others. The exercise was meant to further the economic condition of our rural dwellers that have all this while been excluded from formal economy.
Let me acknowledge the fact that the Corporation is not unaware of the perennial problems between customers and banks on various issues such as arbitrary bank charges, account balances and frauds. While the banks have taken some steps in addressing some of the problems, the Corporation has introduced some measures to control malpractices such as:
1) The creation of a help desk, which is a dedicated toll-free 24-hour telephone line (080063424357), to enable customers report such cases.
2) The establishment of Complaint Units in the Bank Examination Department and Special Insured Institutions Department to cater for the need of customers of deposit money banks and primary mortgage banks/microfinance banks respectively. It is instructive to indicate at this juncture that the Corporation has been receiving a lot of commendations from depositors on those initiatives.
3) The mapping out of a number of public awareness initiatives, including various publications such as Facts about Deposit Insurance, Frequently Asked Question about Deposit Insurance, Basic Knowledge on Banking, 20 Years of Deposit Insurance, amongst others.
Distinguished ladies and gentlemen, our participation in this trade fair is also aimed at sensitizing the banking public and other stakeholders on its mandate and activities. Other public awareness initiatives embarked upon by the Corporation includes the following:
- Periodic press briefings by the Corporation’s MD/CEO;
- Organization of Sensitization Seminar for Judges, relevant Committees of the National Assembly and other stakeholders;
- Partnership with the mass media through the annual Editors Forum and Annual Workshop for Business Editors and Finance Correspondents under the umbrella of the Finance Correspondents Association of Nigeria (FICAN);
- Transmission of documentary on television and radio depositor protection awareness jingles in three major Nigerian Languages, namely Igbo, Hausa and Yoruba and transmitting same on national and local television and radio stations nationwide;
- Production and transmission of a weekly public enlightenment television programmes tagged “NDIC Calling”
- Participation in major trade fairs like Kaduna, Enugu and Lagos International trade fairs;
- Hosting of students of higher institutions on educational visits; and
- the development of a new robust and interactive Website – www.ndic.org.ng and Email – email@example.com
In conclusion, on behalf of the Board, Management and Staff of the Corporation, I wish to express our profound appreciation to the Enugu Chamber of Commerce for their support and co-operation since we started our participation in 2012. We also wish to extend our sincere gratitude to all our special guests, particularly our royal fathers who found time to be here, gentlemen of the press who have continued to be our strategic partners in progress. Distinguished ladies and gentlemen, before you leave this event, I wish to invite you to our stand to avail you copies of our publications.
I thank you all for listening.
UMARU IBRAHIM, mni, FCIB
MD/CEO, NIGERIA DEPOSIT INSURANCE CORPORATION
March 22, 2013