Managing Director and Chief Executive of NDIC, Alhaji Umaru Ibrahim, told The Guardian in an interview at the weekend that the corporation had kicked off another round of examination of the micro-finance institutions with a view to forestalling high incidences of loss of deposit by small savers.
Ibrahim also explained that the exercise was aimed at sanitising the sector and building confidence which waned about two years ago when some 103 of the institutions in the country were closed down owing to poor performance leading to depositors having their funds trapped until the NDIC came to their rescue three months later.
He also revealed that the NDIC had expanded its regional offices to be closer to the banks that they examine so that they can nip in the bud the observed challenges.
The NDIC chief executive said: “As part of the sanitisation, it is not impossible that a few more will be closed this year as part of a clean-up. The CBN has come up with some measures to enhance the operations of the micro-finane banks by segregating them into national, regional and units. And in whatever segment that you are, you are required to have a certain amount of capital that is consistent with the level of operations that you may be carrying out. But one area we are also addressing is capacity building for both our own members of staff as well as the key management and directors of the micro-finance banks for on-going capacity-building and certification for all concerned.”
Ibrahim also said that “this time around, we are addressing the situation anytime it appears so that we don’t leave things piled up which will result in liquidation. We have our ears on and eyes to the ground. We examine the micro-finance banks yearly together with the CBN. We try to identify the weak ones, the poorly managed ones and we help them with advice and so on. We are even coming up with a framework to give financial assistance to the deserving ones. This is because we want to be at the grassroots ourselves, we’ve just increased the number of our zonal offices by three, bringing them up to eight. We have just established an office in Port Harcourt, Sokoto and Yola so that we are close to the operators and the branches of the money deposit banks that we examine.”
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