The Nigerian Deposit Insurance Company (NDIC) reimbursed N9.29 billion of N20.85 billion insured deposits of failed banks as at end of 2018 leaving a total of N10.56 billion yet to be reimbursed.
This was disclosed in the NDIC annual report released recently. The report revealed that of the 429 failed financial institutions as at end of 2018: 53 are Deposit Money Banks (DMBs), 51 are Primary Mortgage Banks (PMBs) and 325 are Micro Finance Banks (MFBs).
The breakdown of the Insurance Deposit paid by these failed banks revealed that the 53 DMBs paid N13.62 billion, the 51 PMBs paid N594.09 million while the 325 MFBs paid N6.63 billion to NDIC as premium.
According to the report, N8.25 billion was paid to depositors of failed DMBs; N2.97 billion was paid to depositors of failed MFBs and N70.53 million to depositors of failed PMBs.
In 2018, NDIC paid N4.83 million to 338 depositors of 18 closed DMBs. As at 31st December, 2018, the NDIC has paid a cumulative sum of N8.25 billion as insured amount to 442,999 depositors of closed DMBs against the payment of N8.24 billion to 442,661 depositors as at 31st December, 2017.
In 2018, the NDIC paid N89.24 million insured deposits to 1,804 depositors of MFBs in-liquidation compared to 173 depositors of closed MFBs and N13.24 million paid in 2017. The significant increase was due to the 138 MFBs that were closed during the year. The cumulative payment of N2.97 billion was made to 83,415 depositors of closed MFBs as at 31st December, 2018, compared to N2.88 billion paid to 81,611 depositors of closed MFBs as at 31st December, 2017.
In 2018, the NDIC paid the sum of N2.13 million insured deposits to 29 depositors of closed PMBs, compared to N15.38 million paid to 170 depositors in 2017. The NDIC had paid the cumulative sum of ₦70.53 million to 869 depositors as at 31st December, 2018 compared with N68.40 million paid to 840 depositors as at 31st December, 2017.
The reason for the non reimbursement of more that 50% of insurance premium of these failed institutions might be unconnected with the low level of awareness on the part of depositors of the failed banks.
Although not all insurance premium are meant to be paid out as usual practice in insurance businesses, but a more than 50% unreimbursed deposit insurance of failed banks in an environment where lack of information is more than obvious. Is a pointer to the fact that most depositors of the collapsed banks are not aware that there is a channel for recovering their trapped fund in these failed banks.