NDIC harps on corporation’s contribution to banking sector
By Blessing Wika, Abuja
The Managing Director of the Nigerian Deposit Insurance Corporation (NDIC), Mr. Bello Hassan, has said the supervisory role of the NDIC is to strengthen the banking sector of the country.
Mr. Hassan also revealed that the NDIC, in line with its mandates, has taken important steps to ensure the safety of the Nigerian banks and protection of depositors.
He spoke at the 2021 NDIC Retreat for members of the Senate Committee on Banking, Insurance and Other Financial Institutions, held at the Zuma Rock Resort, Niger State.
The theme of the retreat was, “The Role of NDIC in Promoting an Effective Supervisory Framework in the Banking Sector.”
The corporation had commenced supervisory measures for digital banks and the enhancement of existing consumer protection measures, especially as regards digital deposit through enhanced collaboration with other safety net players.
The NDIC MD noted that effective supervisory framework was very topical, particularly in the light of current developments in the economy and the challenges presented by the complexity of the financial system and the role the sector plays in promoting economic development.
He noted, “In recent years, the financial services sector has experienced significant transformation, largely driven by advances in information technology, globalization and consolidation.
“New services and products have emerged while new players, financial technology companies (fintechs), have been challenging traditional service providers through faster, cheaper and reliable services.
“The advances in technology, and its benefits in terms of increased access to new markets, financial innovation and increased consumer choices, new challenges, bordering on corporate governance and risk management have been ushered in. For example, new technologies emanating from digitalisation is driving disruption and re-shaping the future across payments and banking ecosystem.
“Consequently, the task of ensuring the safety and stability of the nation’s banking sector has become more crucial for the regulatory/supervisory authorities especially, the NDIC.
“Banks can only effectively perform their role in the economy when they are healthy, safe and sound, and as such expected to be highly liquid, adequately capitalized, with high quality assets and robust risk management systems at all times.
“This is why the banking sector is exceptionally important for more rigorous regulation than any other sector in the economy.”
According to the MD, NDIC remains committed to protecting depositors and is ready to compensate depositors in the event of banks failing to fulfil their obligations.
The mechanism, he explained, is an important means to gain public confidence in the banking system and achieve financial and banking system stability, which he said is one of the most important elements of economic growth and development, especially in a developing economy.
On his part, the Chairman of Senate Committee on Banking, Insurance and Other Financial Institutions, Sen. Uba Sani, said the retreat would assess how the NDIC had fared in its supervisory roles.
