15 June 2015, Abuja – The Nigeria Deposit Insurance Corporation (NDIC) has stated that banks operating in the country are healthy and operate in line with global standards, adding that the corporation monitors activities of the banks.
Deputy Director, Research (NDIC), Hashim Ahmad, made the disclosure in Minna on Monday during a sensitisation of Corps members of the 2015 Batch ‘A Stream II’ at the National Youth Service Corps (NYSC) orientation camp, Paiko in Niger state.
He said the Corporation undertakes proper supervision of the banks in the country as insurer to ensure they remain healthy.
“Nigerian banks are relatively healthy in line with global standard,” Ahmad said. “We don’t normally announce the healthy status of our banks in the public, but we normally say in aggregate and I think our annual report will soon be released and be made available to the public”.
He continued: “The annual report normally summarises the health status of the industry. We don’t particularly say Bank A or B is distressed. We are simply saying that on aggregate basis we will tell you the industry is this or that.
“We undertake supervision of the banks as insurer as you know, no insurer will sit back and allow his risk to crystalize before he wakes up. We are embarking on the supervision of Banks to ensure they remain safe and sound.”
Ahmad further stated that any bank that is identified as distressed or in difficulty is normally turned over to NDIC for management. And so, we manage the Bank until such a time that it is deemed to be fit or safe and sound.
“In the cause of doing that we takeover the management and control of the bank. We can go to that extent. We manage the bank until such a time we think it is able to stand on its feet and then we hand it back to its owners,” he said.
Ahmad continued: “NDIC as the sole liquidator of banks in Nigeria undertakes liquidation when all other avenue to resuscitate the purchase of the bank fails”.
According to him: “The Central Bank of Nigeria (CBN) will then revoke the licence and hand the bank over to NDIC for liquidation widening off of the affairs of the Bank.”
Revealing how soon Savannah Bank will return on board, Ahmad said “We expect the bank to bounce back soonest because it has been handed over to the owners. At our own end, we can only act and exercise our own mandate when a licence is revoked by the CBN.”
Savannah Bank’s licence was revoked in 2002 and they dragged the regulator (CBN) to court where an injunction was given that their licence be returned.
Ahmad said: “As Savannah Bank stands, the licence has been restored by the CBN and there is nothing NDIC can do in terms of paying off depositors, since their licence is back to them. And we can’t go and pay anybody.”