By Chioma Obinagwam
The Nigeria Deposit Insurance Corporation (NDIC) has declared that individuals responsible for the collapse of banks can no longer escape justice, thanks to sweeping new legal powers introduced in 2023.
Speaking during a courtesy visit by the leadership of the Business Recovery and Insolvency Practitioners Association of Nigeria (BRIPAN) to NDIC headquarters in Abuja, Managing Director/CEO Mr. Bello Hassan revealed that the NDIC Act No. 33 of 2023, combined with the Banks and Other Financial Institutions Act (BOFIA) 2020, has dramatically strengthened the Corporation’s ability to prosecute those at fault.
“Before now, weak legal provisions allowed people to hide under the law and escape liability,” Mr. Hassan said. “Today, with the enhanced powers under the NDIC Act 2023 and BOFIA 2020, and with the judiciary now better versed in deposit insurance law, the noose is tightening. We are already seeing individuals voluntarily approaching the Corporation to settle out of court because they know the law has finally caught up with them.”
The NDIC boss cited the rapid payout of liquidation dividends to uninsured depositors of the defunct Heritage Bank – achieved within one year of the Central Bank of Nigeria revoking its licence – as clear evidence of the new laws in action.
He commended the National Assembly for fixing long-standing gaps in the legal framework and praised the judiciary for delivering judgments that protect depositors and hold wrongdoers accountable.
BRIPAN President and Senior Advocate of Nigeria (SAN), Mr. Chimezie Victor Ihekweazu, used the occasion to highlight his association’s role in harmonising all insolvency-related laws into a single, more effective framework. He called for deeper collaboration between NDIC, BRIPAN, and other stakeholders to further strengthen insolvency and business recovery practices across the country.
The strengthened legal arsenal is expected to serve as a strong deterrent against reckless banking practices and boost public confidence in Nigeria’s financial system.
Key takeaways:
- NDIC Act 2023 + BOFIA 2020 give NDIC unprecedented prosecution powers
- Directors and owners of failed banks now face real risk of jail time and asset recovery
- Faster payouts to depositors of closed banks (e.g., Heritage Bank case)
- Closer collaboration planned between NDIC and insolvency practitioners
With these reforms, Nigeria has moved significantly closer to international best practices in bank resolution and depositor protection.
Leave a comment