Proshare Logo
   Market Date: 31-10-2014   
Agriculture ARTS FINANCE All One Min News Archives Bonds Cap Mkt Sentiments Capital Market CASHLESS NIGERIA Commodities Corporate Earnings Daily & Weekly Market Updates Enterpreneurship ETFs Forex Frauds & Scandals General Global Market Insurance Investors NewsBeat Islamic Finance Mergers & Aquisitions Money Market Mortgage Mutual Funds Nigeria Economy Oil Sector Opinions and Analysis Pensions People Personal Finance Politics Power Products & Services Professionals Property Public Offers Private Placements Regulators REITs Stock PICKS Taxation Telcos Travel & Tours Unlisted OTC MARKET World of Business

Current reforms may not hedge banks against future crisis, says NDIC

Category: Regulators


  Read (1771)
Current reforms may not hedge banks against future crisis, says NDIC

December 5, 2011

THE Nigeria Deposit Insurance Corporation has cautioned managers of the existing banks in the country from engaging in practices that could undermine the recent gains of the ongoing reform in the sector, saying that to do otherwise may expose the financial system to any crisis that might be triggered by unforeseen ugly developments in the global economic system in the future.

The Managing Director of the NDIC, Alhaji Ibrahim Umaru, who gave the warning in his opening remarks at the ongoing two-day Workshop for Business Editors and Finance Correspondents Association of Nigeria held in Dutse, Jigawa State, said recent developments in the global economy have continued to show that domestic remedial measures alone may not completely hedge banks from any unforeseen shocks arising from economic depression in the global economic order, hence the need for operators to act in strict compliance with the operational guidelines of the sector.

Ibrahim, who spoke on the increasing importance of corporate governance, efficient risk management  system and other prudential guidelines  to the current drive for stability in the financial services sector, noted that there was the need for managers of the banks to be much more cautious in their business decisions with a view to ensuring that shareholders’ funds are invested safely in all aspects of their operations.

“When we are talking of banking crisis, we should not isolate it from developments in the global system. So, nobody can predict with certainty what will happen in the next few years in the global financial system.

“This is why managers of the banks in the country must always observe the guidelines, entrench corporate governance, create mechanisms that can help further in strengthening internal control and risk management as a way of ensuring security of their shareholders investments.

“The current reform has provided the platform for sustainable growth and stability of the banking sector but it cannot alone guarantee the stability of the system. Operators must constantly ensure that their actions do not expose their banks to future risks that might arise from developments in the global financial system”, Ibrahim said.

“In other words, banking reforms do not by any means constitute an antidote to or elixir of bank failure. For this singular reason, the role of deposit insurance system (DIS) in banking reforms cannot be over-emphasised”, he added.

As a demonstration of the corporation’s resolve to achieve the above, Ibrahim said steps were being taken by the management to support key initiatives to strengthen the banking system, by amongst others, collaborating with all relevant Regulatory Authorities to develop a framework for integrated deposit insurance system as well as the framework for effective resolution of significantly important financial institutions (SIFIs).

The NDIC boss also canvassed the licensing of more micro- finance banks, particularly in the rural areas, as a strategic option of enhancing financial inclusion and boosting the nation’s productivity.

Source: Guardian

 



Tags: , 



Comment With Your Facebook or Yahoo! ID


Latest news


News on Regulators

About Us

Who We Are
Our Team & Partners
Corporate Governance
Advertise with Us
Subscribe / Unsubscribe
Site Map
News Feed - RSS
Newsletter
Contact Us
Volunteer Program
Message from CEO
Resources

News & Features
The Analyst / Market Data
Investor Relations Portal
The Regulator
Economy & Politics
WebTV
Training Portal
Events Calendar
NewsStands - Online Reputation

Products and Services

Research & Market Intelligence
Analyst Services
Offers & Rights Support Service
Investor Relations Services
Alert & Subscription Services
Share Support Services
Proshare Consult
Event & Seminar Coverage
Market Directory
File a Complaint
News & Analysis

#1minNews
News from TheANALYST
Video News from WebTV
Money Market Updates
Opinions & Analysis
Nigerian Economy
Market Data
The Regulator
Newsletters
Discussion Forum
Policy

Subscriber Agreement
Privacy Policy
Data Policy
Disclaimer
Copyright Policy
Trademarks
Comments in Site
Advertising Code
Conflict of Interest
Content Partnership
3rd Parties

Online Trading and Execution
Training
Legal Support Services
Web/Technology Services
File a Complaint