Banks pay N62.4 billion as deposit insurance premium to the NDIC
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Loading... - Tobi Alade
- 13 Oct 2022
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Twelve Nigerian banks listed on the Nigerian Exchange (NGX) paid N62.41 billion to the Nigerian Deposit Insurance Corporation (NDIC) as deposit insurance premium in the first half of 2022,
This represents a 15.4% increase compared to N54.07 billion recorded in the corresponding period of 2021.
This is according to data processed by Nairalytics from the half-year report of the banks under review.
Deposit-taking banks pay deposit insurance premiums through premium assessments on their domestic deposits.
- Hence, the banks’ insurance premium spending is a function of the volume of their customer deposits and their perceived risks.
- Meanwhile, the banks accumulated total customer deposits of N41.25 trillion as of the end of June 2022, representing an increase of N3.28 trillion from N37.97 trillion recorded at the beginning of the year.
- The amount paid by the banks to the regulatory body represents 0.15% of the aggregate customer deposits by the twelve banks. When annualized the figure rises to about 0.3% or 30 basis points.
NDIC charges banks between 30 to 50 basis points on their total demand deposits.
NDIC Payments
A further breakdown of the bank payments to the NDIC, showed that Access Bank paid the highest of N11.1 billion in the period under review, followed by Zenith Bank (N9.78 billion), while Jaiz Bank recorded the lowest payment of N446 million.
Banks with the largest demand deposits will typically pay the most premium to NDIC in terms of absolute numbers. However, some banks pay higher relative to their deposits. Read More...
