The Nigeria
Deposit Insurance Corporation (NDIC) says it will closely monitor
Micro Finance Banks (MFBs) and Primary Mortgage Institutions (PMIs)
to ensure proper investment of depositors funds.
Mr. Ganiyu Ogunleye, the Managing Director of NDIC said this in
Benin on Monday at the opening of a sensitisation seminar on the
extension of deposit insurance to licensed MFBs and PMIs.
He challenged the financial institutions to, as a matter of policy,
identify and finance viable micro projects in their immediate
banking environment.
He said the tendency of some operators to mobilize resources in the
rural or suburban areas mainly for investment in money market
products did not impact positively on the rural economy.
According to Ogunleye, such disposition do not support wealth
creation, being one of the components of the Seven Point Agenda of
the present administration.
He reminded the operators that they had vital role to play in
facilitating economic inclusion of the unbanked segment of the
population.
He also urged them to ensure accessibility of banking services to
financially unsophisticated populace.
The NDIC boss however observe that the rate of rendition of
statutory returns of MFBs and PMIs had been unsatisfactory.
Ogunleye noted that hardly did up to 50 per cent of the operators
render returns as at when due even though such information was
required to monitor the health of the institutions on a constant
basis.
"Also our examination report reveals weak corporate governance as
well as inadequate awareness or total lack of risk management
processes in the MFBs and PMIs.
"I urge you to know that sound governance and effective risk
management are critical to the viability of financial institutions
and to take urgent steps to address these inadequacies," he added.
Ogunleye was represented by the Director (Special Insured
Institution Department) Ms Eunice Mgbojikwe. |
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