Nigeria Deposit Insurance Corporation, NDIC, has said it is now armed with stronger and more effective laws that significantly enhance its ability to liquidate failed banks and prosecute individuals responsible for their collapse.
Managing Director of NDIC, Mr. Thompson Sunday, disclosed this while receiving the President and Chairman of Council of the Business Recovery and Insolvency Practitioners Association of Nigeria, BRIPA, Mr. Chimezie Victor Ihekweazu, SAN, on a visit to the Corporation’s headquarters in Abuja.
Sunday said the Corporation’s powers in the area of the liquidation of failed insured institutions have been significantly enhanced with the enactment of the NDIC Act No. 30 of 2023, together with the Banks and Other Financial Institutions Act, BOFIA, 2020.
A statement by the Head of Communication at the Public Affairs Department, Hawwau Gambo, said unlike in the past when weak legal provisions often allowed culpable individuals to evade accountability, the new legal framework now firmly empowers the NDIC to prosecute parties responsible for bank failures.
Sunday expressed his appreciation to the National Assembly for addressing the long-standing challenge of a weak legal framework that had constrained the Corporation’s operations.
He also commended the judiciary for its growing expertise in deposit insurance law and practice, as demonstrated by the effective adjudication of failed bank cases through judgments that have brought relief to depositors.
“The enhanced powers granted to the Corporation under the NDIC Act 30 of 2023, the BOFIA 2020 and the improved understanding of the judiciary, have made it impossible for individuals to hide under the law to escape liability.
“With stronger legal backing, individuals now approach the Corporation to settle out of court, not necessarily because the law has caught up with them, but because they can see that the noose is tightening around those responsible for bank failures,” he said.
The NDIC boss attributed the Corporation’s ability to realise sufficient assets to declare a first round of liquidation dividends to the uninsured depositors of defunct Heritage bank Limited within one year of the revocation of its license, to the positive impact of the new legal framework.
He reiterated that the NDIC would continue to leverage the strengthened laws while collaborating with BRIPAN and other stakeholders to enhance the effective discharge of its mandate.
Also speaking, the BRIPAN President, Mr. Chimezie Ihekweazu, SAN, highlighted the association’s efforts and achievement in harmonising all insolvency-related laws in the country into a unified framework.
He noted that this has significantly addressed the challenges of ineffective insolvency and business recovery practices, while introducing more viable options for solvency resolution.
He also emphasized BRIPAN’s strong focus on capacity building, calling for further collaboration between the Corporation and his association as well as among stakeholders to strengthen insolvency and business recovery practices in Nigeria.
