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Nigeria: May Amend NDIC Act
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This Day (Lagos)
8 July 2008
Posted to the web 9 July 2008
Stanley Nkwazema
Abuja
The House of Representatives yesterday indicated that the principal Act setting up the National Deposit Insurance Corporation (NDIC) would be amended with a view to lowering the N50 billion profit margin so that it could discharge its obligations to shareholders.
The major clause of the principal Act stipulates that the corporation will only begin to pay dividends to shareholders once it is able to make a profit of N50billion, otherwise it won't be obliged to do that.
The decision to amend the Act was confirmed yesterday by the Chairman of the House Committee on Finance, Honourable John Enoh, whose committee is currently investigating the non-remittance by Ministries, Agencies and Departments (MDAs) and how they have been spending the surpluses realised.
Enoh expressed his committee's disappointment with the NDIC mode of operation, saying it was not satisfied with the principal Act amid revelations by representative of the Corporation, Prof Peter Umoh, that the body had N20billion currently with the CBN.
Umoh, who appeared before the committee said, the money is in two separate accounts with the CBN as deposit insurance fund account and operational surplus account..Enoh said his committee was not pleased with the argument that the threshold of N50billion profit was what the NDIC needed to attain before it could pay dividends to its shareholders and consequently benefit the Federation Account.
He said that the House would review the principal Act to the extent of lowering the threshold, even as the NDIC
disclosed that it had never paid any dividend to both the Federal Ministry of Finance and the CBN since it was established and could not say exactly when the corporation hoped to do it.
"The House is going to amend the Act in order to lower the threshold and ensure that shareholders would benefit from their investment and also money can come into the
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Federation Account", the chairman said, expressing the belief that the sum of N20billion which the corporation had with the CBN was an "idle fund".
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