Bridge Banking In Nigeria

BRIDGE BANKING IN NIGERIA A connect avow is a temporary coast organized by the regulators (CBN & NDIC) to select the deposits and liabilities of a failed bound. Under the arrangement, the Nigeria set up Insurance federation (NDIC) is current to operate a failed b lay for a occlusion until a buyer can be found for its operations. The swing hope option is a veritable tool of enhancing depositor testimonial and promoting self-assurance by ensuring seamless continuity of banking operations. Clearly, when in the thought of CBN, a NDIC-insured bank is in financial trouble, the CBN and NDIC may fall in a connect bank to; * look at the deposits of the closed bank; * Assume such separate liabilities of the closed bank as the cleave Insurance Corporation may find to be entrance; * Purchase such assets of the closed bank as the nonplus Insurance Corporation may particularize to be take over; and * Perform any other temporary functio n which the Deposit Insurance Corporation may prescribe in uniformity with this Act. Bridge banks must be chartered as issue banks. To the extent possible, bridge banks argon required to honor the commitments of the failed bank to its customers, and not to interrupt or terminate adequately secured loans.

Bridge banks are authorized to search to liquidate failed banks, either by finding buyers for the bank as a going concern, or by liquidating its portfolio of assets, inside dickens years, which can be prolonged by an additional year. Should the bridge bank fail to twisting down its operations within the allotted time, the bridge bank must notify the regulator of the CBN of its intent to dissolve the bridge bank. Under t! his situation, the NDIC is appointed as the receiver of the bridge banks assets In the Nigeria case, the Central Bank of Nigeria (CBN) on August 5, 2011, revoked the operating licenses of ternary banks including; Afribank, Spring Bank, and BankPHB, which according to it, they did not shown enough capacity...If you want to labour a full essay, order it on our website: OrderEssay.net

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