NDIC moves to strengthen risk management in banks

The Nigeria Deposit Insurance Corporation (NDIC) has intensified efforts to promote risk-based supervision (RBS) in the banking sector. Speaking at the 12th annual national conference of Risk Managers Association of Nigeria (RMAN) in Lagos, on the theme, 'Financial Sector Stability and Macro-Prudential Risk Regulation: Way Forward for Emerging and Developing Economies,' Managing Director/Chief Executive, NDIC, Alhaji Umaru Ibrahim, underscored the rationale behind the RBS for banks.Alhaji Ibrahim said that the NDIC was collaborating with the CBN in implementing RBS of banks to enable them to effectively evaluate risks inherent in activities and risk management functions of banks.The NDIC boss, who was represented at the conference by the Director, Asset Management Department of the corporation, Mr Adedapo Adeleke, also told risk managers that the various boards of insured institutions were expected to establish an enterprise risk management (ERM) system with clearly defined risk decisions that would be consistent with the established thresholds.He charged the insured institutions to complement their risk management strategies by consistently assessing whether they were deploying their capital relative to their risk exposures and matching their assets with liabilities to avert liquidity crisis, stressing that the banks should always enthrone self-regulation by remaining ethical in their business dealings and stress-testing their capital positions to complement statutory regulations.Meanwhile, the corporation is organising RBS training programme for its examiners to enable them to understand and examine the risk profile of banks and the various risk management models being deployed by the banks.
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