Follow Us on Google
By Chukwuma Umeorah
The Nigeria Deposit Insurance Corporation (NDIC) has revealed that it has obtained Winding up Orders for 96 out of 183 Micro Finance and Primary Mortgage Banks whose licenses were revoked by the CBN in May 2023.
The Managing Director, NDIC, Bello Hassan revealed this on Thursday at a sensitization seminar for Judges of the Federal High Court in Lagos organized by the NDIC, to enlighten the judiciary on the intricacies of the banking industry.
According to Hassan, “As at date, the Corporation had obtained Winding up Orders for 96 out of 183 Micro Finance and Primary Mortgage Banks whose licenses were revoked by the CBN in May 2023, in less than one Year of revocation.”
He added that the NDIC was leaving no stone unturned in ensuring that it fulfils its mandate of protecting the interests of depositors through bank supervision, failure resolution and Liquidation so as to enhance confidence and stability in the financial system.
He added that in fulfilling such mandate, it was imperative to sensitizing the judiciary for better understanding of the practice of the Commission given it’s role.
“We recognize the Judiciary as one of our critical stakeholders. With this, when cases are brought before them, they can receive accelerated hearing and proclamation of Justice,” he explained.
Citing some of the achievements from previous edition of the seminar, Hassan stated that challenge of liquidation-related litigations experienced in the past which made it difficult for the Corporation to wind-up banks whose licenses had been revoked by the CBN and to settle depositors and other claimants promptly has drastically reduced among other achievements.
On his part, Justice Faji, representing the Chief Judge of the Federal High Court, John Tsoho reiterated the need for judicial preparedness in handling the anticipated surge in banking-related cases amid the banks recapalization exercise.
In his words, “Now that we are going into another period of banking consolidation, it is very imperative that judges are on top of their game as regards issues that will come up in court. There will be cases of restructuring, acquisition, mergers and all that. Of course, some banks may also want to stop business of they are unable to meet up with the requirements.
“This means that the judges are going to be very busy and that is why they need to be equipped, and at the end of the day, I believe we would be able to add value to the process.”
In addition to legal deliberations and to complement the court system, Justice Faji suggested the exploration of Alternative Dispute Resolution (ADR) mechanisms within the banking sector stating, “Disputes are resolved much quicker and faster through alternative dispute resolutions. It ensures confidentiality, allows for expert involvement, and ensures that relationships do not go sour.”
With the CBN directive looming over the banking sector, the NDIC and the Judiciary collectively reiterated commitment to collaborate in safeguarding the interests of depositors and ensuring the stability of the financial system.
