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Difficulty: Very hardFinancial System Regulatory Bodies: SEC and NDIC

In the Nigerian financial regulatory architecture, the Securities and Exchange Commission (SEC) exercises supervisory authority over the registration of securities and capital market operators, whereas the Nigeria Deposit Insurance Corporation (NDIC) is statutorily empowered to insure deposit liabilities of licensed banks and administer failure resolution mechanisms for distressed deposit-taking institutions.

Answer: Answer

Answer

The statement is TRUE. The Securities and Exchange Commission (SEC) regulates the capital market and securities trading, while the Nigeria Deposit Insurance Corporation (NDIC) protects bank depositors and manages bank distress resolution frameworks.
The statement correctly describes the separate statutory roles defined by law: SEC regulates securities and capital market operators, while NDIC insures bank deposits and manages bank distress resolution.

Step-by-Step Solution

1
Identify the statutory mandate of the Securities and Exchange Commission (SEC).
SEC is the apex regulatory institution for the capital market, responsible for registering securities, regulating stock exchanges, approving mergers, and supervising capital market operators.
Determining SEC's core jurisdiction establishes whether the capital market oversight portion of the statement is accurate.
2
Identify the statutory mandate of the Nigeria Deposit Insurance Corporation (NDIC).
NDIC guarantees bank deposits up to prescribed statutory limits, co-supervises deposit-taking financial institutions, and manages bank distress resolution and liquidation.
Determining NDIC's core mandate verifies whether the deposit protection and failure resolution portion of the statement is accurate.
3
Compare both functional descriptions against established statutory provisions in Nigerian commercial law.
Both functional descriptions are completely accurate and correctly assigned to their respective regulatory institutions without overlap or misattribution.
Evaluating the combined claims confirms that the overall statement is true.

Key Concept

Statutory jurisdiction and functional separation between SEC (capital market regulator) and NDIC (bank deposit insurer and failure resolution manager).
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Topics

Financial System Regulatory Bodies: SEC and NDIC

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