NDIC calls for stakeholders input for better premium assessment
The Nigeria Deposit Insurance Corporation (NDIC) is asking for input from critical stakeholders towards making the Differential Premium Assessment System (DPAS) Framework more robust and all embracing.
In a release signed by Bashir Alhassan Nuhu the Director, Communication and Public Affairs Department, the NDIC said “the Differential Premium Assessment System Framework was reviewed to make it more risk sensitive and account for significant developments that had taken place in the Nigeria banking system since its adoption in 2008”.
Nuhu further stated that “the review was informed by the need to ensure that the framework conforms to the recommendations of the International Association of Deposit Insurers (IADI) and other global best practices”.
He explained that the review is presently at the consultation stage, “it is imperative for the Corporation to solicit input from its critical stakeholders”.
Bashir Nuhu said the exposure draft of the Differential Premium Assessment System (DPAS) Framework has been placed on the Corporation’s Website, www.ndic.gov.ng for review.
The NDIC urged stakeholders to forward their input, comments and recommendations to NDIC Director, Insurance and Surveillance Department on aliyuam@ndic.gov.ng latest by 30th June 2023
The Corporation adopted the Differential Premium Assessment System (DPAS) in 2008 following the issuance of its framework in 2007 to differentiate premiums payable by Insured Financial Institutions based on their respective risk profile.
The DPAS was aimed at introducing fairness into the premium assessment process, encouraging effective risk management practices in insured institutions and applying a risk differential approach in the deposit insurance premium assessment of insured financial institutions.
The DPAS was introduced to enable banks in the lower risk categories to pay relatively lower premium rates; charge banks in the higher risk categories additional premium for their extra risks; incentivise regulatory compliance and mitigate moral hazard.
