National JudicialInstitute and NDIC Conduct Seminar for Appeal Court Judges on Banking Litigation

Wale Igbintade

Justices of the Court of Appeal convened in Lagos for a sensitisation seminar designed to deepen judicial knowledge of bank liquidation procedures, depositor protection, and the increasing intricacies of financial‑sector litigation in Nigeria.

The event, titled “Enhancing the Efficacy of Bank Liquidation and Depositors’ Protection,” was organised by the Nigeria Deposit Insurance Corporation (NDIC) in partnership with the National Judicial Institute (NJI).

Speakers highlighted the pivotal role of the judiciary—especially the Court of Appeal—in resolving banking disputes, shaping financial jurisprudence, and maintaining public confidence in Nigeria’s banking system.

Opening the seminar, Justice Babatunde Adejumo, Administrator of the NJI, said the programme reflects a deliberate effort to deepen institutional understanding between the judiciary and financial‑sector regulators.

He noted that the stability of financial institutions is a matter of national importance because banking systems rely on public confidence in both the institutions themselves and the legal frameworks that govern them.

He warned that the collapse or distress of financial institutions often has far‑reaching implications for depositors, creditors, businesses, and the broader economy.

“The stability of financial institutions remains a matter of considerable national importance,” he said.

“Banking systems function effectively where there is confidence in the institutions that support them and in the legal processes that govern their operations.

Hence, when financial institutions experience distress or collapse, the consequences are often far‑reaching, affecting depositors, creditors, businesses, and public confidence in the broader financial system.”

Justice Adejumo observed that bank liquidation proceedings frequently involve complex legal and regulatory issues concerning creditor priorities, depositor reimbursement, statutory powers, and recovery mechanisms.

Also speaking, Thompson Oludare Sunday, Managing Director and Chief Executive Officer of the NDIC, said the success of bank liquidation and distress‑resolution processes depends largely on the quality, consistency, and timeliness of judicial decisions.

Sunday, represented by NDIC Executive Director of Corporate Services Emily Osuji, explained that liquidating failed banks in Nigeria has become increasingly difficult because of hidden assets, weak collateral arrangements, competing creditor claims, and more sophisticated financial transactions.

“In practice, the liquidation process is often complex and challenging. Assets may be concealed or dissipated by insiders prior to closure, while some loans may be inadequately collateralised, necessitating extensive asset tracing and recovery efforts,” he said.

He added that the NDIC regularly handles disputes involving depositors, creditors, former bank employees, and other stakeholders over entitlements, contractual obligations, creditor hierarchy, and asset recovery.

He cautioned that prolonged litigation arising from such disputes could delay liquidation proceedings and erode public confidence in the banking sector.

Sunday emphasized the need for ongoing engagement between the judiciary and financial regulators as financial transactions become more sophisticated and regulatory frameworks continue to evolve.

“We are confident that enhanced appreciation of these processes will promote greater alignment between regulatory intent and judicial outcomes, reduce delays, minimise conflicting decisions, and ultimately strengthen public confidence in Nigeria’s banking and financial system,” he stated.

The NDIC chief also noted that sound judicial pronouncements remain essential to sustaining depositor confidence, investor trust, and overall economic stability.

He referenced international standards set by the Basel Committee on Banking Supervision and the International Association of Deposit Insurers, both of which stress the importance of efficient legal systems and independent judiciaries in resolving financial disputes.

In her remarks, Monica Dongban‑Mensem, President of the Court of Appeal, represented by Ali Abubakar Banandi, described the seminar as a significant institutional collaboration aimed at improving judicial understanding of disputes involving financial institutions.

Banandi said previous engagements between the judiciary, the NDIC, and the NJI have enhanced judicial decision‑making in banking and commercial matters.

“This series of interactions has no doubt assisted judges in their decision‑making,” he said, while commending the calibre of speakers and discussants participating in the seminar.