• NDIC has started the final liquidation process for 89 failed microfinance banks and one mortgage bank
• The affected institutions were previously resolved through the Purchase and Assumption model
• New investors took over the banks’ assets and liabilities and relaunched them under new identities
• The Corporation is seeking Federal High Court orders to formally dissolve the defunct banks

The Nigeria Deposit Insurance Corporation (NDIC) has begun the final phase of winding down 89 failed Microfinance Banks (MFBs) and one Primary Mortgage Bank (PMB), nearly two years after their licenses were revoked.

In a statement issued on Wednesday, April 15, 2026, the Corporation said the affected institutions had already been successfully resolved through the Purchase and Assumption (P&A) model.

Under the arrangement, new investors took over the assets and liabilities of the failed banks, recapitalised them, and relaunched them under new names.

The move follows the decision of the Central Bank of Nigeria (CBN) to revoke the licenses of 179 microfinance banks and four mortgage banks in May 2023 as part of efforts to clean up the financial system.

NDIC said it is now taking the final legal step by approaching the Federal High Court for dissolution orders that will formally end the existence of the defunct institutions and discharge the Corporation from its role as liquidator.

The Corporation explained that the process is intended to legally conclude the liquidation of the resolved banks while preserving financial stability and protecting depositors.

According to NDIC:

• 89 failed banks resolved through the Purchase & Assumption (P&A) model
• New owners acquired assets and liabilities, ensuring business continuity
• CBN issued fresh licenses to the acquiring institutions now operating under new names
• NDIC to approach the Federal High Court for dissolution orders of defunct banks
• The Corporation will formally exit its role as liquidator after court approvals
• The majority of affected institutions are Microfinance Banks, with one Primary Mortgage Bank
• Process ensures depositors retain access to funds through successor institutions

The Corporation further stated: “In its capacity as the Liquidator of the defunct banks, NDIC said it will be presenting applications to various Judicial divisions of the Federal High Court to obtain orders of dissolution for the closed banks and to release the Corporation as Liquidator.”

The resolution process reflects wider efforts by regulators to strengthen confidence in Nigeria’s banking system, especially within the microfinance sector, which plays a major role in supporting financial inclusion.

Many of the failed institutions were small, community-focused lenders that served low-income earners, small businesses, and people working in the informal sector.

By using the Purchase and Assumption model, regulators were able to transfer the viable parts of the failed banks to stronger investors instead of allowing them to collapse completely.

This approach helped reduce disruption for customers, preserve jobs, and maintain confidence in the financial sector.

A large number of the affected institutions were based in Lagos, reflecting the city’s position as Nigeria’s commercial and financial centre.

Others were spread across the South-East, South-South, South-West, and Northern parts of the country.

NDIC also noted that many of the successor institutions now have more modern, fintech-focused identities, pointing to a broader shift toward digital banking and improved service delivery.

According to the Corporation, the 89 closed banks were among the 179 MFBs and four PMBs whose licenses were revoked by the CBN on May 22 and 23, 2023.

The NDIC remains responsible for protecting depositors, managing failed financial institutions, and ensuring orderly resolution processes within Nigeria’s banking system.

With the final legal dissolution process now underway, the Corporation says it is reinforcing confidence in the system by showing that failed institutions can be resolved without causing major disruption.

NDIC says 99% of Nigerian bank depositors fully covered under enhanced insurance scheme

Meanwhile, TheRadar earlier reported that the Nigeria Deposit Insurance Corporation (NDIC) had assured Nigerians that approximately 99 per cent of depositors in the country’s banking system are fully covered under its enhanced deposit insurance framework.

The corporation raised the maximum deposit insurance coverage to N5 million per depositor per bank for Deposit Money Banks, Mobile Money Operators and Non-Interest Banks.

Under the revised structure, depositors of Payment Service Banks, Microfinance Banks and Primary Mortgage Banks are insured up to N2 million per depositor per bank.

The corporation also improved payout efficiency, using BVN to credit insured depositors within days of bank failures.