The Nigeria Deposit Insurance Corporation (NDIC) says banks have remained resilient, stable, and sound in spite of the challenges posed by the COVID-19 pandemic.
Bello Hassan, managing director/chief executive, NDIC, said this at the opening of the NDIC retreat for the House of Representatives committee on insurance and actuarial matters, held in Lagos, last week.
The success, the corporation said, was due largely to the proactive policies and support of the regulatory authorities.
Hassan said the contribution of the NDIC to financial stability and resilience can be examined within the context of its activities in the discharge of its mandate of deposit guarantee; bank supervision; distress resolution; and bank liquidation.
He said the corporation encouraged prudent risk management practices in the insured institutions because effective risk management remains central to a safe and sound banking system.
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According to him, some of the measures taken to strengthen deposit insurance system in the Nigeria include the migration to Differential Premium Assessment System (DPAS) from the flat-rate method of assessing and collecting premium with a view to aligning the pricing of deposit insurance to the risk profile of individual banks and the collaboration with the CBN to shift from the compliance-based examination to Risk Based Supervision (RBS).
It is also instructive to indicate that the NDIC is keenly involved in ensuring adherence to corporate governance principles in the banks.
The target ratio, he said, was also developed to ensure operational readiness in deposit insurance guarantee, while deposit insurance cover has been reviewed upward overtime in response to changing deposit distributions in the banks.
In her message, Ronke Sokefun, chairman of NDIC, explained that deposit insurance was a system established by the government to protect depositors against the loss of insured deposits in the event that the bank is not able to meet up to its obligations to depositors.
Represented by Adewale Adeleke, she said the corporation has over the years made tremendous efforts to protect consumers of financial services and promote financial system stability.
“The corporation is still faced with some challenges inhibiting its performance, for the NDIC to continue to successfully deliver on its, it must be sufficiently empowered”.
Speaking at the event, Darlington Nwokeocha, chairman, House committee on insurance and actuarial matters, said the essence of this gathering was re-strategise all that has to do with the banking and insurance, protect the depositor’s funds and put all the insurance instrumentality to boost the confidence of customers in banks.
