NDIC Reaffirms Adherence to Fiscal Responsibility Act, Statutory Remittance Obligations

The Nigeria Deposit Insurance Corporation has reaffirmed its full compliance with the Fiscal Responsibility Act and other statutory remittance requirements, dismissing concerns over alleged non-remittance of funds to the appropriate government accounts. The corporation said it operates strictly within the framework of existing financial regulations and remains committed to transparency and accountability in the management of public funds.

NDIC explained that its financial operations are guided by its enabling Act as well as relevant federal fiscal laws, including the Fiscal Responsibility Act. According to the corporation, its remittance obligations differ in structure from those of conventional revenue-generating agencies due to the unique nature of its mandate as a financial safety-net institution.

The deposit insurer clarified that unlike revenue-focused agencies, its primary responsibility is to protect depositors and ensure stability in the banking system. As such, a significant portion of its income is retained and deployed to meet contingent liabilities, including deposit insurance payouts, bank resolutions and intervention funding during periods of financial distress.

NDIC stated that it consistently makes statutory remittances as required by law after meeting its operational and contingency obligations. The corporation added that all remittances due to the Consolidated Revenue Fund and other designated accounts are computed in line with approved guidelines and submitted within stipulated timelines.

Addressing public discourse around remittances, NDIC noted that misunderstandings often arise from a lack of appreciation of its specialised role. The corporation explained that its financial structure is designed to prioritise depositor protection, which requires maintaining adequate reserves to respond swiftly to bank failures or systemic risks.

The corporation emphasised that its accounts are subjected to rigorous internal and external scrutiny. NDIC disclosed that its financial statements are audited annually by external auditors and reviewed by relevant oversight bodies, including the Office of the Auditor-General for the Federation and the National Assembly.

According to NDIC, these audit processes have consistently affirmed its compliance with applicable financial laws and regulations. The corporation added that no adverse findings have been established regarding its statutory remittances or financial management practices.

NDIC also highlighted its regular engagements with fiscal authorities to ensure alignment with government policies. The corporation said it works closely with the Federal Ministry of Finance, the Budget Office and other relevant institutions to ensure clarity on remittance obligations and financial reporting standards.

The deposit insurer stressed that its compliance with the Fiscal Responsibility Act extends beyond remittances to include prudent budgeting, expenditure control and long-term financial sustainability. NDIC said it prepares its budgets in line with government guidelines and submits them for approval through the appropriate channels.

The corporation further explained that its surplus determination follows a defined legal process. Only funds classified as surplus after meeting statutory and operational requirements are eligible for remittance, in accordance with the law. NDIC noted that diverting funds meant for depositor protection would expose the financial system to significant risk.

Industry analysts have noted that NDIC’s role became even more critical following recent banking sector reforms and regulatory tightening. With increased oversight and higher compliance standards, the ability of the deposit insurer to respond to potential bank distress has become a cornerstone of financial stability.

NDIC pointed out that its interventions in past bank failures have helped protect millions of depositors and prevented wider financial contagion. These interventions, the corporation said, were made possible by prudent fund management and strict adherence to its statutory mandate.

The corporation also referenced its contributions to public confidence in the banking system. By guaranteeing deposits up to insured limits and ensuring timely payouts when banks fail, NDIC said it has helped sustain trust in financial institutions, even during periods of economic uncertainty.

NDIC acknowledged the importance of public accountability and said it welcomes constructive scrutiny of its operations. However, the corporation cautioned against narratives that could undermine confidence in the financial safety-net framework without factual basis.

The deposit insurer reiterated that it does not operate outside the law and has no incentive to withhold funds due to the government unlawfully. According to NDIC, all financial decisions are guided by legal provisions, risk assessments and the overarching goal of safeguarding the banking system.

Experts say clarity around the remittance obligations of specialised agencies like NDIC is essential to avoid misinterpretation. They note that applying the same standards used for revenue-generating agencies to financial safety-net institutions without context could lead to flawed conclusions.

NDIC further explained that international best practices support the retention of sufficient reserves by deposit insurers. Many countries, the corporation noted, allow deposit insurance agencies to build strong funds to ensure readiness for bank resolutions and systemic shocks.

The corporation said Nigeria’s financial system has benefited from this approach, as NDIC has been able to respond decisively to banking crises without resorting to emergency government funding in many cases.

Looking ahead, NDIC reaffirmed its commitment to strengthening governance, transparency and collaboration with oversight institutions. The corporation said it will continue to publish its audited financial statements and engage stakeholders on issues relating to its operations.

NDIC also pledged to support broader financial sector reforms aimed at enhancing stability, protecting consumers and promoting economic growth. According to the corporation, a strong and credible deposit insurance system is essential for a resilient banking sector.

In reaffirming its compliance with the Fiscal Responsibility Act and statutory remittance requirements, NDIC maintained that its actions remain firmly anchored in law and best practice. The corporation said it will continue to balance its fiscal obligations with its core mandate of protecting depositors and preserving confidence in Nigeria’s financial system.