- NDIC to liquidate 87 microfinance banks, others
Currency held outside of Nigeria’s banking system dropped to N3.66trn in July, about 3.32 per cent lower than it was in the previous month.
This was disclosed in Money and Credit data available on the website of the Central Bank of Nigeria.
This showed that the amount outside banks dropped to 90.39 per cent from 93.59 per cent of the currency in circulation recorded in June 2024.
The value of currency in circulation rose in July to N4.05trn from N4.04 trn.
From the beginning of the year, the amount of money in circulation rose by 11.05 per cent compared to a 56.17 per cent rise in the same period in 2023.
Members of the Monetary Policy Committee of the Central Bank of Nigeria have blamed the excess cash in circulation for the accelerating inflation in the country.
Also, money supply (M3), which is a broad measure of the total amount of money in an economy, hit a high of N106.27trn in July 2024, amid tightening measures by the CBN.
The apex bank has maintained a hawkish stance in a bid to rein in inflation.
At its last Monetary Policy Committee meeting in July 2024, the CBN raised the MPR by 50 basis points to 26.75 percent from 26.25 in June 2024.
Meanwhile, credit to the private sector continued its upswing to N75.48trn year-on-year in July 2024.
On a month-on-month basis, banks’ credit to the private sector increased by 3.13 per cent from N73.19trn in June 2024.
NDIC to liquidate 87 microfinance banks, others
Meanwhile, the Nigerian Deposit Insurance Corporation will at the expiration of its notice released on August 23, 2024, approach a Federal High Court to grant the order to dissolve 87 microfinance banks and primary mortgage banks in the county.
The Corporation disclosed this in a statement titled “Notice of intention to terminate liquidation activities” published on its website.
The statement reads, “NOTICE is hereby given to the General Public that the Nigeria Deposit Insurance Corporation (NDIC), in its capacity as the Liquidator of the under-listed closed Microfinance Banks and Primary Mortgage Institutions, in accordance with the provisions of its enabling law and other relevant laws, will at the expiration of thirty (30) days from the date of this publication present an application to the Federal High Court to obtain dissolution orders of the closed banks and to release/discharge Corporation as Liquidator of the banks.”
NDIC stated reasons for its actions to include the fact that the affected banks were either not located or embarked on self-liquidation.
According to the banking type, 62 of the affected financial institutions are microfinance banks while 25 are primary mortgage banks. 80 of these institutions had their licences revoked because they were not located. The balance, 8, embarked on self-revocation.
16 of the affected banks are located in Abuja, the Federal Capital Territory, while 51 are local in Lagos State, the nation’s commercial capital, according to the NDIC list.
Rivers State has five affected microfinance banks; Kogi State has three, and two each in Bayelsa and Delta states.
The two affected microfinance banks in Edo State are Cubic Microfinance Bank and Lofty Height Microfinance Bank. Akwa Ibom, Kwara, Ondo, Osun and Oyo States have one affected bank each.
