The Nigeria Deposit Insurance Corporation (NDIC) has announced that it is prepared to grant some financial assistance to deserving Primary Mortgage Banks (PMBs) and Microfinance Banks (MFBs).
Umaru Ibrahim, NDIC managing director, said that the corporation is already developing a framework for the financial aid which he also stressed would come with some stringent conditions.
Ibrahim disclosed this when the board of directors and management of the Federal Mortgage Bank of Nigeria (FMBN) paid him a courtesy visit in Abuja.
The possible amount for this intervention is not yet known but details of the unique framework would be released to stakeholders as soon as it is approved by the board of the corporation.
However, those MFBs and PMBs that were deliberately mismanaged by their owners would not be eligible for such accommodation bill, Ibrahim warned.
The liquidator said this is part of its efforts at repositioning the sub-sector to enable the Nigerian financial services system perform better.
The Federal Ministry of Finance (FMF), Central Bank of Nigeria (CBN) and the corporation are working out possible measures to revive the sub-sector which had merely collapsed not too long ago.
Some of those measures include among others, the CBN’s revised supervisory guidelines for primary mortgage banks, refinancing scheme in the mortgage sector and the proposed review of the Land Use Act.
It would be recalled that the CBN had in a circular earlier this year, notified all the mortgage institutions about the April 30, 2013 implementation deadline in which N5 billion has been prescribed for national operations and N2.5 billion for state level activities.
This date was, however, extended to December 2013.
The apex bank had also advised that the PMBs could meet the new capital requirements through rights issue; private placement; public offer; mergers and acquisition; takeover; and downscaling, asking that the mortgage firms should conduct due diligence and seek professional, legal and financial advice for any decision.
Ibrahim further announced the commencement of liquidation of seven out of the 25 PMBs recently closed by the CBN with payment of compensation to their depositors.
ONYINYE NWACHUKWU, Abuja
