Crime
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The Nigeria Deposit Insurance Corporation in its latest annual report says the banking sector recorded 12,279 cases of fraud cases in the country in 2015
| By Anayo Ezugwu | Jul 11, 2016 @ 01:00 GMT |
THE banking sector recorded 12,279 cases of fraud in 2015, according to the Nigeria Deposit Insurance Corporation, NDIC. The NDIC in its 2015 annual report released last week, revealed that the amount involved decreased significantly by N7.59 billion or 29 percent from N25.608 billion recorded in 2014 to N18.021 billion in 2015.
The actual loss suffered by the insured banks decreased by N3.02 billion or 48.79 percent from N6.19 billion in 2014 to N3.17 billion in 2015. The report noted that the actual loss sustained in respect of internet banking fraud was N857 million, representing 27 percent of total actual loss of the industry.
The NDIC lamented that there was an increase in the frequency of ATM/Card-Related Fraud cases from 7,181 in 2014 to 8,039 in 2015, an increase of 11.95 percent. However, the loss suffered by the industry due to such frauds declined significantly by 59.4 percent from previous year figure of N1.242 billion to N0.504 billion, representing 15.9 percent of total industry loss to frauds and forgeries.
Out of the 12,279 fraud cases reported by the Deposit Money Banks, DMBs, 425 cases were attributed to staff. The number of fraud cases perpetrated by staff had decreased from 465 in 2014 to 425 in 2015. Similarly, losses arising there from substantially decreased by 70 percent from N3.165 billion in 2014 to N0.979 billion in 2015. The highest percentage of frauds and forgeries cases of 38.59 percent was perpetrated by temporary staff.
With regards to the financial condition of DMBs, the NDIC report said the banking industry total assets grew marginally by 1.36 percent, with total loans and advances rising by 5.56 percent, shareholders’ funds unimpaired by losses increased by 14.02 percent while capital adequacy ratio stood at 17.66 percent.
However, total deposit liabilities declined by 2.83 percent, while unaudited profits decreased by 2.02 percent and non-performing loans increased by 82.87 percent in 2015. The annual report added that the banking industry capital base remained strong giving that the capital adequacy ratio, CAR, of the banking industry was 17.66 percent in 2015 compared with 15.92 percent in 2014. This exceeded the minimum threshold of 10 percent and 15 percent for national and international banks, respectively. Two DMBs which the NDIC did not name had CAR below the prescribed threshold of 10 percent in 2015.
The report said total loans and advances to the Nigerian economy stood at N13.33 trillion in 2015, showing an increase of 5.56 percent over the N12.63 trillion reported in 2014, while non-performing loans to total loans ratio for the industry increased from 2.81 percent in 2014 to 4.87 percent in 2015, but was within the regulatory threshold of 5 percent.
The banking industry was said to have operated profitably in 2015, “though earnings and profitability deteriorated. The unaudited profit-before-tax (PBT) of the banking industry stood at N588.86 billion as at December 31, 2015, representing a decrease of 2.02 percent over N601.02 billion reported as at December 31, 2014” the report said.
The banking industry’s liquidity position was strong as its average liquidity ratio rose slightly from 53.65 percent in 2014 to 58.18 percent in 2015. All the individual DMBs had liquidity ratios above the prudential minimum threshold of 30 percent as at December 31, 2015. Overall, the banking industries remained stable and sound during the period under review.
Reporting on the corporation’s activities in 2015, the NDIC said it complied with the provisions of the Fiscal Responsibility Act in 2015 and remitted the sum of N24,185,762,000 to the Consolidated Revenue Fund of the Federation in 2015 as against N15.38 billion in the previous year.
The NDIC’s operating surplus for 2015 stood at N30.23 billion as against N15.52 billion in 2014. The cumulative amount of loans recovered over the years stood at N27.41 billion as at December 31, 2015, compared with N26.75 billion as at December 31, 2014.
Similarly, the cumulative risk assets recovered from closed Micro Finance Banks, MFBs, amounted to N125.61 million as at December 31, 2015, compared with N124.38 million as at December 31, 2014, while the debt recoveries from the debtors of Primary Mortgage Banks, PMBs, in-liquidation amounted to N24.73 million as at December 31, 2015.
During the year under review, the NDIC also paid N2.41 billion as total liquidation dividends to 550 shareholders of six DMBs-in-liquidation as at December 31, 2015, as against N2.03 billion paid to 453 shareholders of DMBs-in-liquidation as at December 31, 2014.
Regarding payments to clients of failed banking institutions in the country, the NDIC report revealed that the corporation made a cumulative payment of N6.796 billion to 426,324 insured depositors of the closed DMBs as at December 31, 2015, as against N6.795 billion to 426,320 insured depositors in 2014.
The NDIC also made a cumulative payment of N2.86 billion to 81,328 depositors of the closed MFBs as at December 31, 2015, as against N2.77 billion paid to 80,178 depositors in 2014. Also, the NDIC made a cumulative payment of N45.05 million to 595 depositors of closed PMBs as at December 31, 2015, as against N2.02 million paid to 30 depositors in 2014.
The sum of N95.77 billion was paid as liquidation dividend to depositors of DMBs in 2015 compared to N94.74 billion as at December 31, 2014. That amount included the uninsured portion of private sector depositors of 11 out of the 13 banks closed post-bank consolidation which was funded by the CBN.
The NDIC paid liquidation dividends to creditors of DMBs-in-liquidation in 2015 while the sum of N1,728.40 million was declared as dividends to 1,308 creditors of the 10 DMBs. Out of that amount, the NDIC paid the sum of N1,261.73 million to the 965creditors who filed their claims as at December 31, 2015, as against N1,247.77 million paid to the 889 creditors as at December 31, 2014.
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