The Central Bank of Nigeria, CBN, has objected to certain aspects of the proposed amendments to the Nigeria Deposit Insurance Corporation, NDIC Act. Godwin Emefiele, CBN governor, represented by Sulieman Barau, his deputy, gave the indication at a one-day public hearing on the “NDIC Act 2006, Cap N102 LFN 2012 (repeal and re-enactment) Bill, 2015,” by the Senate Committee on Banking, Insurance and other Financial Institutions in Abuja.

Emefiele noted that some of the proposals seek to confer coordinate functions and powers on the NDIC and argued that the Corporation, being the undertaker, cannot seek to be a judge and prosecutor in its own case. He then maintained that the amendments being sought to the NDIC Act should be rejected to avoid chaos and anarchy in the financial sector.

To Emefiele, the implications of the proposed amendment to the NDIC Act enactment would make the NDIC a parallel/coordinate regulator for banks as CBN; confer conflicting supervisory functions and powers on NDIC over banks; and create overlapping regulatory responsibilities for the NDIC. He said the powers that the Corporation sought to assume and exercise and their consequences were analyzed to include; Power to license banks, power to supervise banks without reference to the CBN, power to determine the licences of banks and power to appoint itself as liquidator.

Umaru Ibrahim, managing director of NDIC, in his presentation said the NDIC is seeking the amendments to ensure safety and soundness in the banking system and not seeking any role out of its lawful mandate nor in competition with the CBN.

“We are for collaboration. We are for the safety and soundness of the system. We are not in competition with the CBN. At the same time we cherish our own operational independence and we cherish our mandate as provided by our Act. I can assure you that by the time we go through the details you will find that there are very few areas of misunderstanding or conflict that we need to resolve,” Ibrahim said.