How We Protect Bank Depositors, Maintain Stability Of Banking Sector, NDIC …. As stakeholders applaud its roles

By Clement Nwoji, Abuja

The Nigeria Deposit Insurance Corporation (NDIC) has assured depositors of insured Deposit Money Banks (DMB) of safety of their funds, most especially in event of bank failure and liquidation.

The Managing Director and Chief Executive Officer of the NDIC, Bello Hassan, gave the assurance while addressing participants and stakeholders Monday during NDIC special day at the ongoing 19th Abuja International Trade Fair.

The theme of the fair organised by the Abuja Chamber of Commerce and Industry (ACCI) is “Mobility: Options for Transport, Trade Finance, and Taxation.” The highpoint of the NDIC day at the fair include raffle draw with numerous give away prizes to the winners.

The NDIC Deputy Director, Communication and Public Affairs Department, Hauwa Gambo, representing the MD/CEO, Bello Hassan at the Corporation’s Special Day at the 19th Abuja International Trade Fair

Mr Hassan who was represented by the Deputy Director, Communication and Public Affairs Department, Hauwa Gambo, said: “Our core mandate includes providing deposit insurance to depositors of licensed banks, supervising insured financial institutions, managing distressed banks, and ensuring the orderly resolution of banks in the event of failure. We are committed to safe guarding Nigerians’ bank deposits from the devastating impact of bank failures.

“In collaboration with the Central Bank of Nigeria (CBN), we work tirelessly to ensure the stability of the banking sector, maintain compliance to banking regulations and ensure effective oversight of insured deposit-taking financial institutions.”

He explained that the importance of deposit insurance cannot be overstated in a financial system where confidence is essential, adding that it acts as a safety net that reassures depositors, builds trust in the banking system, and helps to prevent bank runs during periods of uncertainty.

The NDIC Stand at the fair.

He stressed that the NDIC has been instrumental in promoting stability by ensuring that when banks fail, depositors are promptly compensated.

According to Mr. Hassan, “Significant progress has been made in protecting depositors’ funds, with the recent increase in maximum deposit insurance coverage providing the enhanced protection across various financial institutions. This increase ensures that 98.98% of total depositors in Deposit Money Banks (DMBs), 99.27% in Microfinance Banks (MFBs), 99.34% in Primary Mortgage Banks (PMBs), and 99.99% in Payment Service Banks (PSBs) are covered, reinforcing NDIC’s commitment to fulfilling its mandate.”

Citing the latest liquidated Heritage Bank, Hassan observed that it is an unprecedented achievement that the NDIC commenced payments to depositors within four days of Heritage Bank’s closure.

“By leveraging depositors’ Bank Verification Numbers (BVN) as a unique identifier, the Corporation was able to identify alternate accounts and credit the insured amounts of up to N5 million directly, without the need for forms or physical visits to NDIC offices.

“This innovative approach has enabled the payment of 84.98% of depositors with BVN linked accounts to date. This prompt response, alongside the recent increase in deposit insurance coverage from N500,000 to N5 million, has significantly mitigated the Impact of the bank’s failure on depositors”, he said.

He encouraged depositors of any closed bank, especially Heritage Bank, who are yet to receive their payments, to come forward with their BVN, proof of account ownership, identification, and alternative account details.

Dignitaries present included the Director General of the Abuja Chamber of Commerce and Industry, Sir Agabaidu Jideani, Ist Deputy President of Kaduna Chamber of Commerce and Industry, Alhaji Faruk Suleiman and His Royal Highness, the Etsue of Kwali, who respectively commended NDIC for their indispensable roles in protecting the life time deposits bank customers and protecting the economic development of the nation.