N2.54bn MDAs, LGs’ Funds Trapped in 47 Failed Banks – NDIC

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Umaru Ibrahim

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The Nigeria Deposit Insurance ‎Corporation says N2.54 billion belonging to ministries, departments and agencies of federal, state and local governments remain trapped in 47 distressed banks

MORE than N2.54 billion belonging to some local governments and ministries, departments and agencies, MDAs, of the federal and state governments are trapped in 47 banks in-liquidation, without the affected parties filing proof of claims for insured deposits and liquidation dividends.

A breakdown of the money shows that the federal government agencies had N1,533,948,597.90; state governments agencies N949,197,189.54; and local governments N57,448,833.44.

The Nigeria Deposit Insurance Corporation, NDIC, in an advertorial called on the affected parties to file their claims with the corporation within 60 days to enable it carry out verification and payment thereof.

It stated that all enquiries be directed to the director, Claims Resolution Department, Nigeria Deposit Insurance Corporation, NECOM Building (10th floor), 15, Marina Street, Lagos.

The corporation said, “It is to be noted that reimbursement of the insured sums and payment of liquidation dividends in respect of excess uninsured amounts to claimants of failed banks in liquidation is predicated upon the filing of claims and proof thereof in accordance with provisions of Section 492 of the Companies and Allied Matters Act, CAMA, 1990 and Section 41 (3) of the Nigeria Deposit Insurance Corporation Act, 2006.

“The records of 47 failed banks in-liquidation indicate that some local governments as well as ministries, departments and agencies, MDAs, of the federal and state governments are yet to file their proof of claims with the Liquidator for the payment of insured deposits and liquidation dividends despite the efforts of the Corporation to inform them of that legal requirement.

“The records of those 47 banks in-liquidation further indicate that the affected local governments and MDAs have 6,270 accounts with a total sum of N2, 540, 594, 620.88 (Two Billion, Five Hundred and Forty Million, Five Hundred and Ninety Four Thousand, Six Hundred and Twenty Naira, Eighty eight Kobo ) only, which is broken down as follows: Federal Government Agencies N1, 533, 948, 597. 90; State Governments Agencies N949, 197, 189.54; and Local Governments N57, 448, 833.44.

“The corporation had established contact with the Federal Ministry of Finance in respect of the claims of ministries, departments and agencies of the Federal Government. The NDIC had since issued notices of payment to the affected ministries, departments and agencies of the state governments at their last known addresses appearing in the records of the 47 failed banks in-liquidation in accordance with Section 22 (4) of the Nigeria Deposit Insurance Corporation Act 2006.

The NDIC is a parastatal under the ministry of finance, charged with protecting the banking system from instability occasioned by runs and loss of depositors’ confidence. It operates under the Nigeria Deposit Insurance Corporation Act 1990. The NDIC is a member of the Financial Reporting Council of Nigeria. The NDIC complements the regulatory and supervisory role of the Central Bank of Nigeria, CBN, although it reports to the Federal Ministry of Finance.

It also advises the CBN in the liquidation of distressed banks and manages distressed banks’ assets until they are fully liquidated. It has a supervisory role over insured banks.

—  Oct 31, 2016 @ 01:00 GMT

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