Home Finance Savannah bank, SGBN to start operations by 2012— NDIC

Savannah bank, SGBN to start operations by 2012— NDIC

by Business News Report

The Managing Director, Nigeria Deposit Insurance NDIC Alhaji Umaru Ibrahim has disclosed that efforts are being put in place to ensure that Savannah Bank Nigeria (SBN)Plc and Societe Generale Bank of Nigeria (SGBN) Limited are to start operation by 2012.
Umaru said this during the 2011 Editors Forum last weekend in Lagos, stating that by second quarter of the year in focus, the two banks will start operations in order for depositors whose money has been trapped in the bank to get back their funds.

According to him, “following the restoration of the banking licences of both Savannah Bank of Nigeria (SBN) Plc and Societe Generale Bank of Nigeria (SGBN) Limited in 2010 through court judgments, the NDIC in collaboration with the CBN made strenuous efforts to get the two banks to resume operations in the interest of their depositors/customers who were complaining”.
He recalled that Savanna bank took their battle to court, and the court intervened and asked that their licence be returned to them pointing that the court was in their favour, giving them a period of one, two years within which to come back .

Continued he said, “I must say that the time has lapsed with almost nine months a year and that is why we are pushing them to start, saying that for a bank like Savannah that has closed shop for years in banking, it is not easy to come back “
He lamented that these banks building have become sorry sights, they are dilapidated, lost their employees as well as lost access to their records as a result of robbery cases in some areas like the East where the bank has branches.
Highlighting the achievement of the corporation he noted that the corporation carries out its supervisory activities of insured institutions through routine and target examinations and shares this responsibility with the Central Bank of Nigeria CBN.

Statistically he disclosed that the cumulative recovery for the banks in liquidation from 1994 to August 2011 was N22.158 billion out of N170 billion, as well a sum of N8.33 million has been recovered to date in respect of the closed Microfinance Banks.
However, to enhance the pace of debt recovery and payment of uninsured deposits, the corporation has appointed some debt collection agents as well as having discussions with Asset Management Company of Nigeria AMCON for the disposal of some secured debts of closed banks.

Disclosing further, he said at July 2011, the cumulative insured depositors paid in the 35banks in-liquidation stood at N3.304 billion out of N5.24 billion, representing about 63 per cent. The cumulative liquidation dividend paid to the depositors and other claimants of the affected banks was N6.162 billion out of N16.85 billion, representing about 37 percent; meanwhile, 12 of the banks had declared a final dividend of 100 per cent of total deposits.
Speaking on bridged banks, he said no body will say that there will be no problem in any financial institution, illustrating that mergers have been put in place and we will continue.
He said the bridge bank mechanism was adopted by NDIC for the following reasons: to preserve and sustain daily operations of the failed banks by ensuring that all the 577 branches of the banks continue to function.

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