NDIC Pays N120.26bn to Creditors, Depositors of Failed Banks

James Emejo in Abuja

The Nigeria Deposit Insurance Corporation (NDIC) has disclosed that the total sum of N120.26 billion had been disbursed to depositors, shareholders, and creditors of banks in liquidation as of June 30.

The payments comprised N8.269 billion which was paid to 444,010 insured depositors of Deposit Money Banks (DMBs), N102,092 billion to uninsured depositors, N1.28 billion to 1,027 creditors of the affected institutions, as well as N4.89 billion to 980 shareholders.

This was disclosed by the Senior Management Staff of the NDIC, Mr. Tanko Ibrahim, during the 2023 Financial Literacy Day programme at Government Secondary School (GSS), Tudun Wada – where the school’s principal, Mr. Joseph Akor, also appealed to the corporation for assistance in the renovation of dilapidated structures.

Ibrahim said the sum of N3.36 billion was also disbursed to 97,419 insured depositors of Microfinance Banks (MFBs), while uninsured depositors got N20.20 million.

Ibrahim added that 1,833 insured depositors of Primary Mortgage Banks (PMBs) received N124.76 million while N211.43 million was paid to uninsured depositors in the review period.

He said the process of liquidation commences after the revocation of the operating license by the Central Bank of Nigeria (CBN), pointing out that depositors are often accorded priority in funds disbursement before the creditors and shareholders where possible adding that cost-effective realisation of the asset was also important to the corporation.

He told the student participant that the corporation ensures that failing and failed institutions are resolved in a timely and effective manner through several options including financial assistance loans, guarantee for loans, – accommodation bills; technical assistance takeover of management and control of a bank, changes in management, assisted merger or acquisition by another bank; Arranged Purchase and Assumption of failed banks; as well as incorporation of a bridge bank to take over the asset and liabilities of a failing bank.

Also, addressing the students, NDIC Principal Manager, Research Department, Dr. Waziri Galadima, emphasised the need for prudence in spending as well as prioritisation of expenditure.

He explained the difference between “wants and needs” stressing that while the latter is a necessity that must be met, the former could be delayed for future attention.

The school’s principal, however, commended the NDIC for the financial literacy initiative which had continued to impact the students positively.