Depositors of failed banks to share N105b –NDIC

Depositors of failed banks in the country are to share N105 billion just as the Central Bank of Nigeria (CBN) has approved the liquidation of 83 licensed microfinance banks, the Managing Director, Nigeria Deposit Insurance Corporation (NDIC), Umaru Ibrahim, said yesterday.
The NDIC boss disclosed that there are up to 900 microfinance banks in operation of which 83 have been listed for liquidation, adding that plans were on to regulate mobile banking in the country.
Ibrahim disclosed this when he appeared before the Senate Committee on Banking, Insurance and other Financial Institutions, to defend the Corporation’s budget. He did not give the number of depositors of the failed banks that will share the N105 billion.
On the closure of 83 microfinance banks, the NDIC boss said that it was discovered that some of the banks, “existed only on paper” while some were being used to defraud Nigerians.
“Some assets of the banks will also be sold. There is no doubt that the operations of some of the microfinance banks have become epileptic” he said.
Ibrahim said that the NDIC was already working to determine the number of depositors and how much each deposited in the banks in order to pay them.
Some assets of the banks, he said, would also be sold.
“Funding gap is what we do to prepare for the rainy day. We hope and pray that the rainy day does not come but any insurance should prepare for the rainy day. As we speak, no bank benefited from the fund in 2013.”
On ‘dollarisation’ of the economy by speculators, he said that the issue was being looked into by the CBN to ensure that it does not affect the economy.
He informed lawmakers that the corporation also tried to pay depositors of institutions that had been liquidated.
“We have stepped up awareness and campaigns about our activities to make sure that members of the public put up claims of their locked-up deposits in liquidated financial institutions. We appointed some banks as agents with the assistance of our various zonal offices that we had established in various parts of the country.”
On regulation of mobile banking he said: “The depositors of the institutions offering mobile banking needed to be identified and protected.The whole essence of this is that if we have millions of such people sending and collecting money through mobile banking system, we want to ensure that in event of any crisis, they are covered.
“Unless they have that assurance of being covered, you don’t expect them to accept to participate in this revolutionary project that is coming on board.”

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