NDIC pays N48.8bn to depositors of 11 failed banks

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The Nigeria Deposit Insurance Corporation (NDIC) has paid N48.8bn to depositors in 11 banks that failed to meet the December 31, 2005 consolidation deadline handed to the banks in the country by the Central Bank of Nigeria. Managing Director and Chief Executive Officer of NDIC disclosed this in Abuja at an event to mark the 20th anniversary celebration of NDIC.

He said the amount was paid on uninsured deposits of 11 out of 13 banks that failed to meet the consolidation deadline, while another N3.9bn was paid on insured deposits of the banks.

Other payments made by the corporation included N3.3bn out of N5.2bn insured deposits of 34 banks that failed before the consolidation exercise and the declaration of N12bn liquidation dividend in favour of uninsured depositors of the 24 banks.

The corporation had also paid 100 per cent liquidation dividend in favour of depositors of 11 banks that failed before the consolidation as well as paid dividend to shareholders of the defunct Alpha Merchant Bank, Pan African Bank and Nigeria Merchant Bank. The combined effect of the achievements manifested in the significant growth of financial soundness indicators, which include growth of banks’ deposit liabilities, from N30.8bn in 1989 to N8.7tn in 2008. Others included growth of banks’ total assets from N86.9bn in 1989 to N19.3tn in 2008 and growth of deposit accounts from N15.8m in 2002 to N30.7m in December, 2008.
 
Meanwhile, the President of the Senate said stronger regulation was needed to salvage the economies of developing nations. He said increasing globalisation, uncertainty and instability in international financial monetary policies among some developed countries was heightening fears of a gloomy outlook for the world economy and was capable of presenting considerable risks for developing nations.

I want to say that the weak integration of economies of African countries with the rest of the global system insulated such economies from the global financial crisis at the initial stage.

However, foreign investment and aids have reduced as the credit squeeze takes hold, therefore, African countries must be ready to re-direct their economies in order to surmount the challenges posed: by the global economic crisis.