The Nation Newspaper

Tag: Alhaji Umaru Ibrahim

  • How we saved 6,000 bankers from sack, by NDIC

    Not less than 6,000 workers of the defunct Skye Bank now Polaris were saved from being sacked, The Nigeria Deposit Insurance Corporation (NDIC) said on Thursday.

    Managing Director of the corporation, Alhaji Umaru Ibrahim, disclosed this while speaking at the NDIC Special Day, at the ongoing 40th Kaduna International Trade Fair.

    Ibrahim, who was represented by the Head of Communications and Public Affairs of the corporation, Alhaji Muhammad Kudu, said it was on record that the intervention also ensured stability in the banking industry.

    He said apart from ensuring that normal operations continued in all the 277 branches of the bank, the intervention also ensured that depositors of the closed bank had unhindered access to their deposits in excess of N949.6 billion as at June 2018.

    According to him, the corporation has also taken measures to ensure that all those who contributed to the failure of the bank are prosecuted to serve as deterrent to others.

    The managing director, said in February this year, a Federal High Court in Lagos had sentenced the managing director of the failed Integrated Microfinance Bank Plc,  Simon Ademola Akinteye, to 32 years imprisonment over frauds that led to the failure of the bank.

    “The corporation had  also been relentless in its debt recovery efforts particularly the debts owed to banks in liquidation so as to enhance payment of liquidation dividends to depositors whose balances were in excess of the insured limits.

    READ ALSO: We’ve recovered N29bn from debtors of liquidated banks – NDIC

    “Also in 2018, a total of N526, 397, 116.26 was recovered in respect of deposit money of banks in liquidation, N51,159,867.97 and N710, 057.83 from primary mortgage banks and micro finance banks respectively.

    “The cumulative recovery from debtors of deposit money banks, micro finance banks and primary mortgage banks as at December 31,2018 stood at N29.01 billion, N125.84 million and N290.43 million respectively.

    “These efforts were boosted by series of judgments obtained against banks in liquidation and realisation of physical assets of closed banks, apart from the conviction of the MD of the defunct integrated MFB, the Corporation also secured a landmark judgment against the First Bank of Nigeria Plc, to the tune of N556,493,034.16 in favor of depositors of Lead Merchant Bank Limited (in liquidation).

    “As the corporation marked its 30th anniversary this year, it had been three decades of resilient hard work and continuous innovations in order to achieve our goal of becoming the best Deposit Insurer in the world by the year 2020.

    “We may not be there, but the NDIC already has become a reference point in the implementation of the DIS in Africa and beyond,” Ibrahim said.

    The NDIC boss restated commitment of the corporation towards achieving a safe, sound and stable financial system geared towards sustainable economic growth.

  • Three million Nigerians lost N18bn to MMM – NDIC

    The Nigerian Deposit Insurance Corporation (NDIC) has said about three million Nigerians lost N18 billion in the Phonzi scheme, popularly called Mavrodi Mundial Movement (MMM).

    The Managing Director of the Corporation, Alhaji Umaru Ibrahim, stated while speaking at the ongoing 38th Kaduna International Trade Fair on Thursday.

    Represented by the NDIC Deputy Director of Corporate Affairs, Alhaji Hadi Suleiman, Ibrahim lamented that despite repeated warnings by the Central Bank of Nigeria (CBN) and the corporation, Nigerians still patronise MMM.

    He said,”The Phonzi scheme is the phenomenon of illegal fund managers, popularly called ‘Wonder Banks’ which have continued to defraud unsuspecting members of the public of their hard earned money. This phenomenon has been a source of concern because despite our repeated warnings over the years, some members of the public have continued to fall victims of their fraudulent practices.

    “We would like to reiterate the fact that these fund managers are illegal as they are neither licences by the CBN to take deposits from members of the public nor are those who patronise them covered by the NDIC deposit insurance scheme.

    “I want to also draw the attention of some cooperative societies which often go beyond their primary mandate by accepting contributions from members as cooperative societies are only recognised to mobilise savings from their members.”

    While advising the general public on the dangers of keeping large sums of money at home or in market shops, he said there are 978 licensed microfinance banks nationwide out if which seven are spread across Kaduna State.

     

     

  • FG slashes CBN’s budget by 50%

    The Central Bank of Nigeria (CBN) has disclosed that 50% of its budget has been slashed by the federal government, lamenting that this cut in budget has seriously affected its capabilities to fund some financial system initiatives.

    This disclosure was made by the Director of the Financial System Stability (FSS 2020) of the CBN Mr Mohammed Suleiman when members of the FSS 2020 visited the the Nigeria Deposit Insurance Corporation (NDIC) yesterday in Abuja.

    According to Mohammed Suleiman, “funding has been a major issue, the FSS 2020 programme since its inception has always been bankrolled single handedly by the CBN. The CBN is beginning to weary a little bit because the current budget this year was reduced by 50% and that is majorly affecting some of our capabilities to implement some of these strategic objectives.”

    Suleiman lamented that “50% of our budget cut is no small measure at all. We need to agree on the funding approach, we need to have a rethink and get the support of all implementing institutions. The FSS2020 is not a CBN project it is a financial system project, all financial system players have to take ownership of the project and be willing to support it.”

    During the exchange of views on the way to move the FS2020 project forward an official of the NDIC revealed that it costs around N198 billion to fund the FSS2020 project.

    The Director FSS2020 who is also a staff of the CBN noted that “we will structure the FSS2020 to include dedicated team for monitoring, tracking and reporting and ensure regular quarterly or biannual meeting of stakeholders for the progress and implementation of the strategy.”

    Suleiman identified some of the challenges the FSS2020 team have had to grapple with to include: inadequate financial skills development particularly in the capital market; unavailability of investable funds for long term financial products; non existence of listing rules for special purpose vehicles; increasing cost of transactions and operations; weak risk management.

    Other challenges include: low level of card usage on POS and high ATM usage for cash transactions; physical insecurities and prevalence of financial fraud; low levels of financial literacy and inclusion; low acceptability of Mobil payment and merchant locations; non existence of sound collateral management; inadequate legal and regulatory framework for commodities market and unwillingness of private companies to go public; inadequate foreign direct investment and non existence of integrated credit scoring system.

    To ensure that the FSS2020 project does not fail because of lack of funds, Suleiman stated that “the intervention is to advocate that agencies making budgetary provisions provide funds for development because these products need the support of budget to implement them.”

    He also expressed concern that Nigeria does not “have the required skills for these products, we need to build the capacity of the industry, we have started capacity building at Woodpecker for heads of strategy of implementing institutions who were in attendance at Golden Tulip in Lagos recently.

    The FSS2020 director then revealed that that capacity building programme “cost the CBN £144,000 because facilitators were brought in from UK. We will also build capacities in the bonds markets and derivatives.”

    Already, they have identified agencies that will take ownership of these strategies, they are CBN, SEC, NSE, NDIC PenCom, National Assembly, Nigeria Commodities Exchange, Budget and National Planning, Federal Ministry of Trade and Investment, SMEDAN and SON (they will be in charge of setting standards for the commodities to make them fit for purpose).

    Mohammed Suleiman decried what he called inadequate legal framework and to address this inadequacy, the secretariat of the FSS2020 has come up with some planned interventions to address the inadequate legal framework.

    He said they have been able to come together with other stakeholders to create some legislative interventions through bill for the consideration of the National Assembly.

    “Some of the interventions behind the bills that we have crafted about three weeks back are the warehouse receipt bills, the securitization bill, the mortgage and allied matters bill, and the SMEDAN amendment bill these are bills that we have so far reviewed and are ready for transmission to the Federal Executive Council (FEC).”

    For now they have concluded work on “the payment system management bill which has been approved by the FEC, the one awaiting the FEC approval is the collateral registry bill which has been forwarded to the office of the Attorney General of the Federation for onward transmission to the FEC for consideration, these are the bills that we need to support the initiative in achieving these objectives.”

    He also stated that they “have started work on the debt factoring bill because we need to look elsewhere for alternative sources of funding for long term financing of infrastructural development and we are looking at the capital market.”

    Reacting to these claims and requests by the FSS2020 team, the Managing Director of the NDIC Alhaji Umaru Ibrahim assured the FSS2020 team that the corporation would donate technical staff as requested by the team “as soon as there’s a formal request but he was quick to remind the team that there is an existing sharing formula for funding the FSS2020 project.

    Alhaji Umaru Ibrahim also noted that the NDIC “has very visible presence in the activities of the FSS2020”, he advocated for a common wallet and appealed that “the CBN should more than others because it is in a position to do better.”

  • Big scandal

    Big scandal

    •Whatever excuses it gives, NDIC has not done enough to return funds to depositors
    of failed banks, even after 25 years

    The scandalous revelation that about N25 billion depositors’ fund, recovered from 48 failed banks in the past 25 years, are yet to be claimed by customers, is quite confounding. Such obfuscating adventure can only happen in this country.   No better managed clime can fathom such exploitative dereliction of statutory duty.

    Alhaji Umaru Ibrahim, Managing Director, National Deposit Insurance Corporation (NDIC), at a recent sensitisation programme for stakeholders in Ado-Ekiti, Ekiti State, declared through Bello Shittu, a deputy director of the corporation: “We are worried about depositors whose monies are trapped in banks and they have refused to file their claims. As an organization, we have been asking those concerned to access us but many have refused. In the last 25 years, we have had cause to liquidate 48 banks; and we have paid over N102 billion to depositors, both insured and uninsured. Yet, we still have N25 billion waiting for depositors to collect.’’

    Of the N25 billion yet to be claimed, insured amount reportedly is in excess of N5 billion while uninsured amount is in excess of N20 billion.

    The foregoing situation is akin to damning cases in the capital market, where of billions of Naira worth of  dividends remain unclaimed.  In our view, the authorities have not shown sufficient concern about how the investing public can access these dividends.

    We are aware that Nigerians are not that buoyant that they would abandon whatever token they had in these failed banks. Since Nigerians are not Father Christmas, we believe that the problem at hand is failure on the part of NDIC to rise up to its statutory duties, particularly on measures to promote early refund of trapped funds.

    We are disturbed that the corporation, 26 years after it was established by the NDIC Decree 22 of 1988 (now NDIC Act No. 16, 2006), has not made appreciable impact on aggrieved bank customers; and even the banking public — most of whom are not even aware of its role.

    The corporation, to the few with scant knowledge of its role, is deemed to have failed to provide effective supervisory role necessary to detect early distress signs in banks; and to bring such under timely control.  We know of reported NDIC statistics showing its lagging approach to issues.

    For instance, out of the total insured deposits of N17.873 billion of 48 deposit money banks (DMBs), in liquidation since 1994, a paltry cumulative sum of N6.682 billion had been paid to 528,204 insured depositors as at December 31, 2012.  Similarly, a cumulative sum of N2.50 billion had been paid to depositors of the 103 microfinance banks (MFBs) which were closed in 2010.

    We equally know that the corporation uses abandoned bank accounts, among others, as alibi for delay in refund of trapped bank money.

    NDIC appears to wring its hands in abject surrender to customers reportedly deaf to its calls, even if the matter is about their hard-earned money.  But we want the corporation to tell us what has happened to addresses and even phone numbers, including next-of-kin contacts, through which these customers could be reached?

    What efforts has the corporation made to get to them; and how cumbersome is the process of filing for refund by those who are aware?

    Could it be that the corporation cannot afford the budget demands of sending mails or even calling up these people to come for their money? What has happened to the accruable interest on this money all this while?

    We demand that the corporation should be more altruistic in the discharge of its duties.

    Henceforth, the NDIC must endeavour to meet up with its strategic mandate of protecting depositors; be seen to be effectively contributing to the safety of people’s funds and stabilizing the nation’s financial system.

  • Be hard on bank fraudsters, NDIC urges judges

    The Nigeria Deposit Insurance Corporation (NDIC) on Monday urged judges of the Federal High Court to be “hard on Bank fraudsters,” so as to restore depositors’ confidence.

    The Managing Director of the Corporation, Alhaji Umaru Ibrahim, made the call at a sensitisation seminar on “The Challenges to Deposit Insurance Law and Practice,’’ for judges.

    Ibrahim said the judges’ understanding was needed to abate the fraud in the banking system.

    He said that deliberate efforts should be geared towards quick dispensation of all pending liquidation-related cases.

    Ibrahim said the corporation was faced with difficulties in the execution of court judgments.

    He said the corporation had a vulnerable funding base, as well as difficulties in recovering debt owed to failed banks by debtors.

    According to Ibrahim, most of the problems stem from poor public awareness and inadequate legal framework.

    “The Nigerian judiciary, legal practitioners and other esteemed stakeholders have important roles to play in ensuring that the mandate of the Corporation is realised.

    “As our partners and stakeholders, I urge you to use your good offices and privileged positions to ensure that the corporation is empowered to safeguard the Nigeria banking system,” the News Agency of Nigeria quoted the NDIC boss as saying at the workshop.

    In his opening address, the Chief Judge of the Federal High Court, Justice Ibrahim Auta, said the seminar was necessary to keep judges abreast with the operations of the NDIC, and the sustenance of the country’s economy.

    “Acquiring such technical capacity will certainly enable us to make efficient, effective and informed decisions based on law for the interest of the nation’s economy,’’ Auta said.