By Henry Ojelu, LAGOS

In a move to tackle delays and conflicting rulings that often trail failed banks, the National Judicial Institute, NJI, and the Nigeria Deposit Insurance Corporation, NDIC, have initiated fresh steps to strengthen judicial handling of bank liquidation cases and protect depositors’ funds.

The push came to the fore on Monday at a high-level sensitisation seminar for Justices of the Court of Appeal held in Lekki, Lagos, where both institutions warned that weak or delayed judicial decisions could undermine financial stability and erode public confidence in the banking system.

Declaring the seminar open, NJI Administrator, Justice Babatunde Adejumo, said the increasing complexity of financial disputes, particularly those arising from bank failures, makes it imperative for appellate courts to deliver decisions that are not only legally sound but also responsive to the realities of the banking sector.

He warned that loss of depositor funds has implications beyond individual hardship, noting that it could damage Nigeria’s financial reputation and discourage investment.

“Confidence is the foundation of any banking system. Once depositors begin to lose faith due to bank failures, the consequences extend to the entire economy,” Adejumo said.

He stressed that judges must understand both the legal framework and the technical workings of banking operations to effectively adjudicate disputes involving failed financial institutions.

The NJI boss also acknowledged growing public criticism of the judiciary, attributing it largely to heavy caseloads and misconceptions about court processes.

“If a judge has about 500 cases and continues to receive more filings, delays become inevitable. Unfortunately, the public often interprets this as inefficiency,” he said, while insisting that the National Judicial Council, NJC, continues to discipline erring judicial officers.

In her keynote address, President of the Court of Appeal, Justice Monica Dongban-Mensem, underscored the strategic importance of judicial capacity in financial sector stability, describing the seminar as a critical intervention.

Represented by Justice Ali Gumel, she said sustained collaboration between the judiciary and financial regulators has become indispensable in addressing the peculiar challenges of banking-related disputes.

“These engagements have consistently enhanced the quality of judicial decisions in financial matters and will continue to do so,” she said.

On its part, the NDIC identified delays in court processes and inconsistent judicial pronouncements as major obstacles to efficient bank liquidation and timely reimbursement of depositors.

Managing Director of NDIC, Mr. Thompson Sunday, said the corporation’s ability to resolve failed banks effectively depends significantly on how quickly and clearly courts determine disputes arising from liquidation processes.

Represented by Executive Director, Corporate Services, Mrs Emily Osuji, he said: “The success of bank liquidation is closely tied to judicial outcomes, especially at the appellate level where binding precedents are established.”

Sunday noted that liquidation cases are often bogged down by disputes over creditor hierarchy, asset recovery and contractual obligations, further complicated by concealed assets and poorly collateralised loans.

He warned that without a clear and consistent judicial approach, such disputes could prolong liquidation processes, delay payments to depositors and weaken confidence in the financial system.

“As financial transactions become more sophisticated, the need for a deeper understanding between the judiciary and financial regulators becomes even more critical,” he added.

The NDIC boss said the seminar was designed to bridge knowledge gaps by exposing justices to the corporation’s statutory mandate, liquidation procedures and depositor reimbursement framework.

He expressed optimism that improved judicial understanding would reduce delays, minimise conflicting judgments and enhance the overall efficiency of bank resolution processes.

Sunday further linked effective judicial intervention to broader economic stability, noting that timely and well-reasoned decisions help boost depositor confidence and attract investment.

He also referenced global best practices, pointing out that international financial standards emphasise the role of a strong and independent judiciary in maintaining a resilient banking system.