The Nigeria Deposit Insurance Corporation (NDIC) has warned that mandatory fiscal deductions, especially the 50 per cent cost-to-income ratio policy, are constraining its ability to grow the Deposit Insurance Fund (DIF) a key reserve used to protect bank depositors in the event of financial institution failures.
According to Managing Director Thompson Oludare Sunday, the NDIC fully complies with the Fiscal Responsibility Act 2007 and other statutory remittance obligations, but the deductions significantly reduce the corporation’s capacity to build adequate reserves needed to manage bank collapses effectively.
Mr. Sunday made the remarks during a courtesy visit to the Ministry of Finance Incorporated (MOFI) in Abuja, where he also noted that international standards recommend that deposit insurers maintain strong, independent funds. To ensure financial resilience and safeguard depositor confidence, the NDIC is seeking an exemption from the current cost-to-income rule.
MOFI Managing Director Dr. Armstrong Takang commended the NDIC’s transparency and promised continued engagement with the Ministry of Finance to support efforts that balance government revenue requirements with the need to protect depositors and maintain stability in the financial system. Visit www.jocomms.com for more news.