The Nigeria Deposit Insurance Corporation (NDIC) has maintained that all Deposit Money Banks (DMBs) in Nigeria are safe and sound, denying that Polaris Bank has been sold.
The reaction from NDIC follows recent media reports that Polaris Bank has been secretly sold to a new investor.
The clarification was made by the Managing Director of NDIC, Bello Hassan, on the sideline of a 3-day capacity-building workshop organized by the Legal Department of the corporation for law enforcement agencies at BWC Hotel, Victoria Island, on Wednesday in Lagos, where he also insisted that Polaris Bank is safe and sound.
What the Managing Director of NRC is saying
- Hassan said, “All banks that are operating within the country are sound in as much as their licences have not been revoked.
- “If there is a problem, the regulator that issues the licence will be the one to revoke the licence.
- “In as much as the licence is not revoked, you’re free to continue to bank with the institution; it means it is safe.”
The NDIC boss also explained that the corporation usually carried out stress tests on banks on a monthly basis, to ascertain their financial soundness.
- He said: “The Central Bank also does stress testing, and so do we in NDIC. In fact, we do it on a monthly basis to ascertain the financial soundness of those banks and we see no red line.
- “When we talk of key financial soundness indicators, we are talking about the capital adequacy and liquidity and the quality of the assets.
- “Those two solid financial soundness indicators that you use to gauge the safety and soundness of these institutions are robust.
- “So, based on that, the banks are safe and sound; continue to bank with them.’’
Backstory
- Some media reports surfaced a few days ago with claims of an alleged secret acquisition of Polaris Bank. The reports alleged that the CBN had concluded plans to sell the bank to Auwal Lawan Abdullahi, a son-in-law to Ibrahim Babangida for N40 billion.
- The report also alleged that the CBN Governor, Godwin Emefiele, had secured presidential authority to proceed with the transaction, with a public announcement expected soon.
- However, Polaris Bank, in its reaction, refuted the report, saying that such speculative publication was a deliberate intention to create panic and as such, should be disregarded.