Deposit Money Banks (DMBs) lost a total sum of N25.61 billion to fraud and forgeries within the banking system in 2014, according to the Nigeria Deposit Insurance Corporation (NDIC).

This amount represented an increase of N3.81 billion or 17.5 per cent compared to N21.80 billion lost in the previous year.

Also, a total of 10,612 fraud cases were recorded in 2014 compared with 3,786 cases in 2013, representing an increase of 182.77 percent.

As a result, the expected/actual loss in fraud and forgeries increased from ₦5.76 billion in 2013 to ₦6.19 billion in 2014, representing an increase of 7.57 per cent largely due to the astronomical increase in the incidence of web-based (online banking)/ATM and fraudulent transfer/withdrawal of deposit frauds.

The disclosure was contained in the NDIC 2014 Annual Report, which was released to journalists tuesday.

The corporation, however, reiterated that the health of the banking system remained intact as 23 banks had been rated sound and satisfactory during the period under review.

It said: "Overall the banking industry was safe and sound in 2014."

The report further stated that the asset quality of the banking industry improved significantly improved during the period under review as total industry loans and advances stood at increased by 25.73 percent to ₦12.63 trillion in 2014 compared to  ₦10.04 trillion in 2013."

However, it noted that total industry’s non-performing loan portfolio increased by 10.26 percent to N354.84 billion compared to ₦321.66 billion in 2013.

The report stated that banking industry non-performing loans to total loans ratio improved from 3.20 percent in 2013 to 2.81 percent in 2014, revolving within the regulatory threshold of 5 percent.

"The observed improved asset quality could be explained by the improved process of loan underwriting as well as the continued purchase of non-performing loans (NPLs) by AMCON," it said.

According to the report, the NDIC paid a total sum of ₦6.83 billion to 529,046 insured depositors of 48 closed DMBs in 2014 compared to 6.824 billion to 528,277 insured depositors in 2013.

Similarly, the corporation disclosed that a cumulative sum of N2.77 billion was paid to 80,178 verified depositors of closed Micro Finance Banks (MFBs) in 2014 compared to N2.52 billion paid to 75,571 verified depositors in 2013.

In addition, a cumulative sum of N2.02 million was paid to 30 verified depositors of closed Primary Mortgage Banks (PMBs) in 2014.

The NDIC said the sum of N94.74 billion was paid as liquidation dividend to 250,592 depositors of DMBs  in 2014 compared to N93.51 billion paid to 250,497 depositors 2013.

According to the corporation, the amount included the uninsured portion of private sector depositors of 11 out of the 13 banks closed post-consolidation which was funded by the Central Bank of Nigeria (CBN).

It said the sum of N1,728.4 million was declared as dividends to 1,284 creditors of nine banks out of which the NDIC had paid the sum of N1,247.77million to the 889 creditors who filed their claims as against N1,191.54 million paid to the 424 creditors 2013.

On the financial condition of banks in 2014, it said the banking industry’s financial soundness indicators revealed that the industry remained generally sound.

The corporation said the industry recorded significant growth in assets of 11.84 percent while credits to the economy grew by 25.73 percent as well as and deposit liabilities which rose by 7.45 percent.

It added that unaudited profits of the industry showed a growth of 11.31 percent in 2014 adding however, that Capital Adequacy Ratio (CAR) of the Deposit Money Banks (DMBs) declined by 1.26 percentage points from 17.18 percent in 2013 to 15.92 percent in 2014. This, however, exceeded the minimum capital adequacy threshold of 10 percent.