NDIC, CBN reaffirms partnership on financial system stability

Barbara Bako, Abuja.

The Managing Director/Chief Executive Officer of the Nigeria Deposit Insurance Corporation (NDIC), Mr. Thompson O. Sunday, has reaffirmed the Corporation’s commitment to working closely with the Central Bank of Nigeria (CBN) to strengthen the stability of the nation’s financial system.

Speaking during a courtesy visit to the CBN headquarters in Abuja, Mr. Sunday praised the apex bank for its ongoing reform initiatives, particularly under the leadership of Governor Olayemi Cardoso.

He commended the stabilization of the foreign exchange market and the recapitalisation drive for Deposit Money Banks, describing them as significant steps in strengthening the financial system.

The NDIC chief disclosed that the Corporation is aligning its operations with the amended NDIC Act 2023, and is set to embark on a strategic restructuring process.

According to him, the goal is to better fulfil its risk minimization mandate, as well as develop a new corporate strategy to replace the current one, which expires at the end of the year.

Mr. Sunday also highlighted recent milestones, including the payment of N54.62 billion to 691,418 depositors of the defunct Heritage Bank, and the declaration of a 9.2 kobo per Naira liquidation dividend to uninsured depositors all within one year of the bank’s closure.

He added that efforts were ongoing to establish a target funding framework.

Despite these achievements, the NDIC boss noted some operational challenges, such as the absence of a unique identifier like the Bank Verification Number (BVN) for corporate customers, and difficulties in collecting premiums from insured institutions that do not operate accounts with the CBN.

He expressed the Corporation’s willingness to collaborate with the CBN to resolve these issues.

In addition, Mr. Sunday appealed for the development of a joint crisis preparedness framework between the NDIC and the CBN to enhance crisis response and depositor protection.

Responding, CBN Governor Mr. Olayemi Cardoso congratulated the new NDIC leadership on their appointments and expressed optimism about strengthening collaboration between the two institutions.

“Our meeting today is a clear testament to our willingness to work together. The CBN counts on NDIC’s support in navigating the uncertain times that we are in,” he said.

Mr. Cardoso acknowledged the value of strong inter-agency collaboration, especially in light of the challenges facing the financial sector.

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He noted that his two years in office have provided important lessons requiring both the CBN and the NDIC to adopt proactive strategies and modern tools for financial system stability.

He described the NDIC’s visit as timely and emphasized the need to work together in mitigating risks and maintaining public confidence in the banking system.

Also speaking, Mrs. Rita Sike, Director of Financial Policy and Regulation at the CBN, said the proposed joint crisis preparedness framework could be handled under the Financial Services Regulation Coordinating Committee (FSRCC).

She also revealed that the apex bank was enhancing its Credit Risk Management System (CRMS) to integrate the Global Standing Instruction (GSI), which will accommodate Other Financial Institutions (OFIs).

The NDIC delegation included Executive Director, Operations, Dr. Kabir Katata; Director of Human Resources, Mr. Yakubu Shehu; Director of Legal, Mr. Olufemi Kushimo; and Assistant Director, Communications and Public Affairs, Mrs. Regina Dimlong.

The CBN team included Mrs. Rita Sike, Mr. Nnadi Maduka from the Corporate Communications Department, and Mrs. Salamatu Jubril-Adeniji from the Compliance Department.