CBN, Experts Speak on Access, Zenith Others’ Health as NDIC Refunds Money to 182 Failed Banks Depositors

• There are at least 24 Deposit Money Banks currently approved by the Central Bank of Nigeria, among other financial institutions
• The CBN is tasked to ensure that all financial institutions are financially sound and meet the various vital indicators
• Financial experts and the CBN have provided clarification on the financial health status of Nigerian banks amid the ongoing refunds to depositors of 182 failed bank

The Central Bank of Nigeria(CBN) has assured Nigerians that the banking system is healthy and has no cause for concern.

The apex bank's assurance is coming as the Nigeria Deposit Insurance Corporation(NDIC) commenced the process of paying depositors of failed banks.

Legit.ng had earlier reported that the CBN revoked the operating license of 182 banks, mostly microfinance banks and primary mortgage banks.

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Efforts are currently ongoing by NDIC to ensure depositors with funds in the banks get their money back.

CBN assures Nigerians

While the exercise has raised concerns among Nigerians on the financial health of other banks, CBN, in its last Monetary Policy Committee (MPC) meeting for July 2023, assured Nigerians that there is nothing to worry about.

According to the apex bank, there is relative stability in key financial soundness indicators and resilience of Nigerian banks.

Part of the communique issued after the MPC meeting reads:

"In the Banking System, Financial Soundness Indicators (FSIs) remained stable and strong. The Capital Adequacy Ratio (CAR) stood at 11.2 per cent, Non-Performing Loans (NPLs) ratio of 4.1 per cent and Liquidity Ratio (LR) of 48.4 per cent, as at end June 2023."

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Expert speaks

Meanwhile, a financial expert Godwin Unegbu, who is the past president of the Chattered Institute of Bankers of Nigeria (CIBN), explained what could put a bank under stress.

He said:

“When Nigerians borrow from the banks, they think the money is national cake. They are always reluctant to pay back, and that has been part of the problems of the banks.

“All the banks have that problem; it is just those that can get more and more deposits funding them that will not have the problem of distress"

Also, Prof Uche Uwaleke of Nasarawa State University Keffi said that the apex bank had consistently maintained the financial soundness of DMBs.

Uwaleke also noted that only the CBN was in a position to declare the financial soundness or otherwise of any bank.

“This is especially in relation to capital adequacy, liquidity ratios and nonperforming loans."

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Access Bank, GTCo, Zenith, and UBA pay shareholders highest dividends

In another report, Legit.ng reported that Nigeria's Stock market investors had bumper harvests from their investments.

United Bank for Africa (UBA), Guarantee Trust Holdings, Zenith Bank, and Access Bank Holdings paid N236.43 billion dividend payout in 2022.

While Zenith Bank and GTCo recorded the most attractive dividend-paying stocks in the banking industry.

Source: Legit.ng