The Senate on Thursday passed for second reading, a bill seeking to amend the Nigeria Deposit Insurance Corporation  Act.

The bill sponsored by the Chairman, Senate Committee on Banking, Insurance and Other Financial Institutions, Senator Adetokunbo Abiru (APC, Lagos East), aimed at making the corporation more effective, ensuring its independence and autonomy, and bringing it in line with current realities.

Leading the debate on the bill,  Senator Abiru noted that there have been a series of appeals from and consensus among stakeholders on the need for an amendment of the Act to address all the issues that have been raised concerning it.

The lawmaker added the bill proposes to empower the President with the power to make direct critical appointments as against the extant Act which restricts the President’s power for appointment of Managing Director and Executive Directors based on recommendations by the Governor of the Central Bank of Nigeria.

Senator Abiru said, “This bill which is co-sponsored by all the 42 members of the Senate Committee on Banking, Insurance and other financial institutions was read the first time in this hallowed chamber on Wednesday 22nd November, 2023.

“The bill seeks to amend the Nigeria Deposit Insurance Corporation Act No 63 of 2023 to make the Corporation more effective, safeguard its independence and autonomy and to bring it in line with current realities and best practices.”

The lawmaker further explained that the bill seeks to amend this provision to bring into in line with and in consonance with Mr. President’s power of appointment as enshrined in the Constitution of the Federal Republic of Nigeria 1999 (as amended).

He argued further that the Bill will guarantee the independence of NDIC to perform its functions saying ”  Section 1 (3) of the Act provides that the Corporation shall be independent in the performance of its functions” nearly all of its important and exclusive duties, functions and powers are to be exercised subject to the concurrence of the Central Bank of Nigeria.”

He also submitted that the bill seeks to reintroduce geographical representation which was scrapped by the 2023 Act.

“The importance of the duties and functions of the Corporation viz a viz the need for inclusivity taking into cognizance the diversity of the nation requires that geo political representation in the board is restored.

“In addition to harnessing the diversity of the nation and engendering inclusivity, the geo-political spread also helps with the dissemination of information of the activities of the Corporation” he explained.

He added that provisions of the principal act which makes the Permanent Secretary, Ministry of Finance the Chairman of the Board are also being reviewed as a result of the workload of the affected government functionaries.

He said, “In the same vein, the reasoning for the Director-General of the Securities and Exchange Commission being a member of the Board and the Interim Management Committee is also being addressed.”

He explained that SEC is the regulator of the capital market and has nothing to do with deposit insurance just as he stated that the bill will introduce the need for the Minister of Finance to constitute an Interim Management Committee for the Corporation within 30 days after the expiration or termination of the tenure of the Board to forestall a recurrence of the recent situation where the Corporation faced challenges in its operations as a result of the absence of a board.

“The bill if passed into law will correct the anomalies that have been highlighted above, strengthen the corporation to make it more effective and safeguard its independence and autonomy to bring it in line with current realities and best practices”, he stressed.

After exhaustive debate on the bill by senators, the Senate passed it for a second reading.