NDIC Secures Court Order, Set to Complete Shut Down of Several Nigerian Banks, Gives Reasons

NDIC Secures Court Order, Set to Complete Shut Down of Several Nigerian Banks, Gives Reasons

  • The NDIC is looking to complete the shutdown of banks whose licenses were revoked by the CBN
  • A court order has been secured to begin liquidation and subsequently pay off customers of affected financial institutions
  • NDIC assures depositors of the safety of funds and expresses readiness to work with the judiciary for a strong financial system

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Legit.ng journalist Dave Ibemere has over a decade of business journalism experience with in-depth knowledge of the Nigerian economy, stocks, and general market trends.

The Nigeria Deposit Insurance Corporation (NDIC) has secured a court order to complete the shutdown of 96 out of 183 microfinance and primary mortgage banks.

The affected banks' licenses were revoked by the Central Bank of Nigeria (CBN) in May 2023.

NDIC moves to liquidate more Nigerian banks
NDIC will begin another round of bank liquidation Photo credit: Patrick Meinhardt
Source: Getty Images

NDIC to close Nigerian banks

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Bello Hassan, the managing director of the NDIC, revealed this at a sensitisation seminar for Judges of the Federal High Court in Lagos.

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Speaking at the occasion, he said:

“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 committed to fulfilling its mandate of protecting depositors through bank supervision, failure resolution and liquidation so as to boost confidence in the financial system, Punch reports.

Court role in banking system

The NDIC boss also commented on the role that the judiciary plays in the fulfillment of the mandate to ensure a strong financial system in Nigeria.

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Hassan added:

“We recognise 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.”

NDIC begins customers' verification of failed bank

Ealier, Legit.ng reported that the NDIC commenced verification of insured depositors of Peak Merchant Bank in liquidation.

This is in line with its duty of deposit guarantee and reimbursement of depositors in case of bank failure.

Peak Merchant Bank Limited's operating license was revoked on Friday, 28 February 2003.

It further noted that the verification exercise is a precursor to paying insured sums to the depositors, the Nation reports.

Proofreading by James Ojo Adakole, journalist and copy editor at Legit.ng.

Source: Legit.ng

Dave Ibemere avatar

Dave Ibemere (Senior Business Editor) Dave Ibemere is a senior business editor at Legit.ng. He is a financial journalist with over a decade of experience in print and online media. He also holds a Master's degree from the University of Lagos. He is a member of the African Academy for Open-Source Investigation (AAOSI), the Nigerian Institute of Public Relations and other media think tank groups. He previously worked with The Guardian, BusinessDay, and headed the business desk at Ripples Nigeria. Email: dave.ibemere@corp.legit.ng.

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