Depositors’ Coverage: NDIC increases PMBs deposit insured limit by 150%

By Chioma Obingwam

The Nigeria Deposit Insurance Corporation(NDIC) has increased the Maximum Deposit Insurance Coverage (MDIC) per depositor of Primary Mortgage Banks(PMBs) by 150 per cent from N200,000 to N500, 000.

The corporation disclosed that the upward review was to ensure coverage of over 90 per cent of depositors in the banking sub sector.

Buttressing, Managing Director/Chief Executive, NDIC, Alhaji Umaru Ibrahim said: “The Honourable Minister of Finance has approved an upward review of the deposit insured limit for depositors of PMBs to N500, 000 in order to ensure coverage of over 90 percent of depositors in the banking sub sector.”

“As one of the three pillars of financial safety-net, the corporation has been protecting the interest of depositors by ensuring the safety of their bank deposits,” he continued.

Ibrahim noted that the MDIC for PMBs is not the only sub-sector that has witnessed an upward review but stated that MDIC per bank has also progressively increased from N50, 000 in 1989 to its current N500,000 per depositor per Deposit Money Bank (DMB).

In retrospect, the insured limit for micro finance banks (MFBs) and primary mortgage banks (PMBs) in 2009 was increased from N100,000 to N200,000 per depositor per MFBs/PMB in 2010.

“Following the CBN’s licensing of non-interest banking institutions (NIBIs) and 21 mobile money operators (MMOs), the corporation equally extended deposit insurance coverage to the subscribers of these banking products to the limit of N500, 000 per depositor,” he said.

Essentially, depositors who have funds in excess of the insured limit are entitled to liquidation dividend after recovery of debts and sale of physical assets of closed banks.