NDIC Gains Stronger Legal Powers to Prosecute Parties Responsible for Bank Failures
In a significant development for Nigeria’s financial sector, the Nigeria Deposit Insurance Corporation (NDIC) has announced a major reinforcement of its legal authority, empowering it to more effectively liquidate failing banks and hold responsible parties accountable.
The announcement was made in a press release issued from Abuja by the Corporation’s Head of Communication and Public Affairs, Hawwau Gambo.
A New Era of Accountability
Thompson Sunday, the Managing Director of the NDIC, outlined how the enactment of the NDIC Act No. 30 of 2023, coupled with the Banks and Other Financial Institutions Act (BOFIA) 2020, has substantially enhanced the Corporation’s mandate. These legislative changes mark a pivotal shift from a past where insufficient legal provisions often allowed individuals responsible for bank collapses to evade justice.
“The NDIC is now in a much better position to prosecute those responsible for bank failures,” Sunday stated, signaling a new era of accountability. He commended the National Assembly for tackling the long-standing issue of a weak legal framework that had previously hamstrung the Corporation’s operations.
Tangible Results and Judicial Cooperation
The strengthened legal backbone is already yielding tangible results. Sunday highlighted that the Corporation’s ability to realize sufficient assets to declare a first round of liquidation dividends to the uninsured depositors of the defunct Heritage Bank Limited—within a single year of its license revocation—is a direct consequence of the new legal environment.
He also praised the judiciary for its growing expertise in deposit insurance law, noting that effective handling of failed bank cases has provided much-needed relief to depositors. This judicial proficiency, combined with the new laws, is creating a powerful deterrent.
A Proactive Shift in Behavior
Perhaps one of the most telling signs of the new framework’s effectiveness is a change in behavior among potential offenders. Sunday observed that individuals are now proactively approaching the Corporation to settle matters out of court.
“This isn’t 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 explained, indicating a newfound respect for the Corporation’s prosecutorial powers.
The NDIC has reiterated its commitment to leveraging these strengthened laws while continuing to collaborate with all relevant stakeholders to effectively protect depositors and ensure the stability of the nation’s financial system.
Source: Daily Nigerian