Business
NDIC Seeks Review Of Creditors Rights
The Nigerian Deposit Insurance Corporation (NDIC) said in order to improve on borrowing culture, the creditor’s right mechanism require a drastic overhaul through appropriate legislation.
Ganiyu Ogunleye, Managing Director and Chief Executive Office of the Nigeria Deposit Insurance Corporation (NDIC) said while the on-going efforts of the Economic and Financial Crime Commission (EFCC) on debt recovery is appreciated the long-term solution is for borrowers to appreciate that bank credits are largely funded from depositor’s fund and that delinquent credits contribute to illiquidity banks.
Ogunleye who was speaking at the just concluded annual seminar for finance correspondents and business editors organised by the corporation, said the procedures for taking and enforcing collaterals in Nigeria are most inefficient as depositors easily frustrate creditor’s banks by abusing the judicial process.
He said the corporation had come across debtors who would prefer to engage solicitors that could protract cases in court for many years rather than make effort to resolve their debt obligations, adding that bank debtors with such a mind-set constitute a threat to efficacy of the proposed Asset Management Company (AMC).
He noted that essentially, bank management is risk management and that there is need for regulators to focus more on risk management by banks for early detection of systemic risk management proactive response. “It was in this context that the joint NOIC and the CBN special examination of the 24 universal banks was recently conducted, the special examination reveal weak corporate governance, insides abuses, dissipation of depositors fund, undisclosed large credit exposures to related entities as well as poor risk management”, he said.
The NDIC boss further explained that it is imperative that each bank should have in place a binding contract for the tenure of its CEOs, adding that another salient issue relates to executive compensation, especially performance bonus that is based on profit which could be either pre-tax or after-tax.
He recalled that recent development in the banking sector underscored the need for a downward review of the single, Obligor Limited as earlier canvassed by the corporation post consolidation. “The single Obligor limit at 20 per cent of unimpaired shareholders funds is too high post consolidation. A high Obligor Limit could induce concentration of credit risk”.
He however said that the economic reform agenda of the present administration requires a sound financial system.
“Payment of tuition fees for undergraduate/postgraduate studies shall be subject to a maximum limit of $25,000.00 per semester,” the Manual states.
The expansion of international card limits also reflects growing confidence among lenders that foreign exchange liquidity has improved enough to support retail dollar transactions.
Speaking recently at the BusinessDay 14th Annual CEO Forum in Lagos, CBN Olayemi Cardoso, governor of the CBN said buying and selling activities now increasingly determine outcomes in the foreign exchange market, unlike in the past when market participants relied heavily on routine Central Bank interventions.
According to Cardoso, Nigeria’s net foreign exchange reserves have risen from just over $3 billion at the start of the reform programme to more than $40 billion, while gross reserves have climbed to about $52 billion, providing stronger confidence for investors and enabling the Central Bank to reserve interventions for periods of market stress rather than day-to-day liquidity management.
The restoration and expansion of international naira card spending limits are increasingly being seen as one of the clearest signs that the benefits of the CBN’s foreign exchange reforms are beginning to reach households, students and businesses making legitimate cross-border payments.
The Secretary-General and Chief Executive Officer, WEC, Dr Angela Wilkinson, disclosed this in a statement, last Thursday.
“Nigeria’s participation comes at a pivotal time as the country seeks to expand energy access, strengthen energy security, accelerate gas development and mobilise the capital required for industrialisation and sustainable economic growth.
“WEC Nigeria will convene leaders from across the energy ecosystem, apply the WEC’s globally recognised Energy Trilemma framework to Nigeria’s unique context, and promote evidence-based dialogue, practical collaboration and informed policymaking.
“It will also ensure that Nigerian and broader African perspectives contribute meaningfully to global energy conversations,” she said.
Wilkinson expressed confidence that Nigeria would play a significant leadership role at the World Energy Congress scheduled for Riyadh in April 2027 and beyond.
The statement also quoted the Chairman of WEC Nigeria, Isa, as describing the country’s participation as an opportunity to deepen national and African leadership within the global energy community through practical solutions tailored to regional development priorities.
He said the platform would promote collaboration across sectors and attract sustainable investments into Nigeria’s energy sector.
The Chief Executive Officer of WEC Nigeria, Wunti, was quoted in the statement as saying that the council would connect leadership, evidence and investment to build a secure, affordable and sustainable energy system.
“This system will be capable of driving economic growth and shared prosperity.”
According to him, the platform will also connect Nigerian institutions and businesses with international knowledge, technology, partnerships and investment opportunities through the World Energy Council’s global network.
Recall that WEC, founded in 1923, is the world’s oldest independent and impartial community of energy leaders and practitioners, advancing informed, collaborative and practical action across the global energy system.
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