The Nigeria Deposit Insurance Corporation and the Exercise of its Statutory Power as a Liquidator: Any Limit?

Abstract

In recent times, there have been arguments in certain quarters as to the extent of the powers of the Nigeria Deposit Insurance Corporation (NDIC) as a liquidator of a failed insured institution. Some have further queried if the NDIC can realize wasting assets of a failed insured institution, without having recourse to Court (where a winding up proceeding has commenced). Others have queried: (x) the appropriateness of the NDIC filing a petition for winding up of a failed bank in the face of an action challenging the revocation of the banking licence of a failed insured institution; (y) the authenticity of the postulation that where a failed bank is challenging the revocation of its banking licence, a petition for winding up of the bank should be stayed until the determination of the suit challenging the revocation and that any disposal of assets of a failed bank will be caught by the doctrine of lis pendens; and (z) the veracity of the proposition that once the licence of a bank is revoked, it stands revoked until the revocation is set aside by an order of court.It is in this wise this article seeks to consider, in succinct details, the exact powers of the NDIC as a provisional liquidator of a failed insured institution and the limitations, if any, to the exercise of such powers. In doing adequate justice to this topic, efforts will be made to consider the provisions of both the NDIC Act 1988 (Old Act) and the NDIC Act 2006 (New Act) as well as relevant provisions of the Companies and Allied Matters Act (CAMA). The writer will also leave no stone unturned in alluding to relevant decided cases that will help provide a holistic view of the topic.