Banks lose N18.02bn to fraud in 2015, 30% less than 2014– NDIC

The Nigeria Deposit Insurance Corporation (NDIC) said on Tuesday in its annual report that fraud cases in the banking sector increased by 15.71 per cent in 2015.

The corporation explained that a total of 12,279 fraud cases were reported, representing an increase of 15.71per cent over the 10,612 fraud cases reported in 2014.

However, the amount involved decreased significantly by N7.59 billion or 29.63per cent from N25.608 billion in 2014 to N18.021 billion in 2015.

Similarly, the actual loss suffered by the insured banks decreased by N3.02 billion or 48.79per cent  from N6.19 billion in 2014 to N3.17 billion in 2015.

The report noted that the actual loss sustained in respect of internet banking fraud was N857 million, representing 27per cent of total actual loss of the industry.

It said:  “There was an increase in the frequency of ATM/Card-Related Fraud cases from 7,181 in 2014 to 8,039 in 2015, an increase of 11.95 per cent.  However, the loss suffered by the industry due to such frauds declined significantly by 59.4per cent  from previous year figure of ₦1.242 billion to ₦0.504 billion, representing 15.9per cent  of total industry loss to frauds and forgeries.”

Out of the 12,279 fraud cases reported by the Deposit Money Banks (DMBs), 425 cases were attributed to staff. The number of fraud cases perpetrated by staff had decreased from 465 in 2014 to 425 in 2015. Similarly, losses arising there from substantially decreased by 70% from N3.165 billion in 2014 to ₦0.979 billion in 2015. The highest percentage of frauds and forgeries cases of 38.59per cent was perpetrated by temporary staff.

With regards to the financial condition of DMBs, the NDIC report said the banking industry total assets grew marginally by 1.36per cent, with total loans and advances rising by 5.56 per cent , shareholders’ funds unimpaired by losses increased by 14.02 per cent  while capital adequacy ratio stood at 17.66per cent .

However, total deposit liabilities declined by 2.83per cent, while unaudited profits decreased by 2.02% and non-performing loans increased by 82.87per cent in 2015.

The annual report added that the banking industry capital base remained strong giving that the capital adequacy ratio (CAR) of the banking industry was 17.66per cent in 2015 compared with 15.92per cent in 2014.

The cumulative amount of loans recovered over the years the NDIC said stood at N27.41 billion as at 31st December, 2015 compared with N26.75 billion as at 31st December, 2014.

Similarly, the cumulative risk assets recovered from closed Micro Finance Banks (MFBs) amounted to N125.61 million as at 31st December, 2015 compared with N124.38 million as at 31stDecember, 2014 while the debt recoveries from the debtors of Primary Mortgage Banks (PMBs) in-liquidation amounted to ₦24.73 million as at 31st December, 2015.

During the year under review, the NDIC also paid ₦2.41 billion as total liquidation dividends to 550 shareholders of six DMBs-in-liquidation as at 31st December, 2015 as against N2.03 billion paid to 453 shareholders of DMBs-in-liquidation as at 31st December, 2014.