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Senate President Godswill Akpabio
The Senate has passed a bill to strengthen the Nigeria Deposit Insurance Corporation’s capacity to safeguard depositors, ensure the stability of financial institutions, and promote trust in the banking system.
It passed the bills for the third and final reading on Tuesday.
The legislation, titled, “Nigeria Deposit Insurance Corporation Act No 33 of 2023,” was sponsored by Senator Adetokunbo Abiru (APC, Lagos East) and all the members of the Senate Committee on Banking, Insurance, and Other Financial Institutions.
Abiru presented the report of the panel at plenary on Tuesday
He said the bill would also make the NDIC more effective, safeguard its independence and autonomy, and bring it in line with current realities and best practices.
The bill consolidated the power of the President to appoint the Chairman and members of the board of the NDIC while the Central Bank of Nigeria which hitherto recommended to the appointees, would now concentrate on supervising the corporation.
The NDIC, based on the new amendment of its Act, would focus on the examination of the banks.
He noted that although the NDIC 2023 Act made substantial improvements to the 2006 Act, its implementation had been fraught with continuous debates.
He specifically said stakeholders had consistently been engaging in a series of appeals on the need for an amendment of the Act to address all the issues that have been raised concerning it.
He said, “The Nigerian Deposit Insurance Corporation (Amendment) Bill, 2024, is thus a critical piece of legislation aimed at strengthening the Nigerian financial system.
“The proposed amendments will enhance the NDIC’s capacity to safeguard depositors, ensure the stability of financial institutions, and promote trust in the banking system.
“Given the rapidly evolving nature of the financial sector, this Bill represents a timely response to the challenges and opportunities that lie ahead.”
Abiru added that the current Bill would lay to rest once and for all, the claims that the bill was assented to by former President Muhammadu Buhari, were materially different from what was passed by the 9th National Assembly.
He said, “To further empower the corporation by guaranteeing its independence in performing its statutory functions in line with Section 1 (3) of the principal Act.
“The principal (2023) Act curiously restricts the President’s power to appoint the Managing Director and Executive Directors and provides that they are to be to persons recommended by the Central Bank of Nigeria Governor.
“The (2024) bill (now) seeks to amend this provision to bring it in line with and in consonance with Mr. President’s power of appointment as enshrined in the Constitution of the Federal Republic of Nigeria 1999 (as amended).”
Abiru further stated, “The provisions of the principal Act which makes the Permanent Secretary, Ministry of Finance the Chairman of the Board is also being reviewed.
“This is because the workload and busy schedule of that office is such that makes such appointments untenable.
“The importance of the need for the Minister of Finance to constitute an Interim Management Committee for the Corporation within 30 days after the expiration or termination of the tenure of the Board is also introduced in the bill.
“This is to forestall the recent situation where the Corporation faces challenges in its operations as a result of the absence of a board.”
