- The Nigeria Deposit Insurance Corporation (NDIC) says about 82.36 per cent of total insured deposits of the defunct Heritage Bank have been paid
- It said depositors with amounts above N5 million will be paid after the liquidation of the bank’s assets
- The NDIC’s action is in line with its CBN-appointed role as the defunct bank’s liquidator
In a statement on Sunday, August 11, the Director of Communication and Public Affairs, NDIC, Bashir A. Nuhu, said the remaining 17.64 per cent of the insured deposits yet to be paid belonged to depositors whose accounts have post no debits (PND) instructions or have no Bank Verification Numbers (BVN).
The statement added that others yet to be paid are those with no alternative accounts in other banks or accounts with a KYC limit on the maximum lodgment per day and are yet to come forward for verification.
Nuhu said, “This unprecedented achievement of direct payment through BVN-linked alternate accounts without the need for depositors to visit NDIC offices or fill out forms marks a historic shift for the NDIC in the prompt reimbursement of depositors with payment of about 82.36 per cent of the total insured deposit to date.
“It is instructive to state that the remaining 17.64 per cent of the insured deposits yet to be paid were largely depositors whose accounts have post no debits (PND) instructions or have no BVN.
“Others are those with no alternative accounts in other banks or accounts with KYC limit on the maximum lodgment per day and are yet to come forward for verification.
“These categories of depositors are presently being contacted by the corporation through telephone calls and text messages to come forward for verification.
“As earlier mentioned in our press release, press conference and advert in the print and electronic media, the verification can be done by visiting any of the corporation’s offices or online at www.ndic.gov.ng/claims.”
‘Depositors with amounts above N5 million will be paid after assets liquidation’
On depositors with amounts in excess of the maximum insured deposit of N5 million, which make up a larger chunk of total deposits of the defunct Heritage Bank, the NDIC said it is working to ensure this category of depositors is promptly paid through liquidation dividend realised from the bank’s assets.
It said, “However, depositors with balances exceeding N5 million have been paid the initial insured sum of N5 million, while the remaining balances (classified as uninsured deposits) will be paid as liquidation dividends upon realisation of the defunct bank’s assets and recovery of debts owed to the defunct bank.”
The corporation added that it has commenced the process of debt recovery and realisation of investments and physical assets of the defunct bank.
The NDIC also reiterated its commitment to ensuring the safety of depositors’ funds in all licensed banks, while enjoining members of the public to continue their banking activities without fear as all other banks remain safe and sound.
Recall that the NDIC has said the defunct bank was owed about N700 billion in loans, vowing to recover them. It added that 99.9 per cent of the 2.3 million depositors of the bank have less than N5 million balance in their account while only about 4,000 depositors have about N5 million and above in the bank.
NDIC is the liquidator of the assets of defunct Heritage Bank
The Central Bank of Nigeria (CBN) had on June 3 appointed the NDIC as liquidator of the assets of Heritage Bank following the revocation of the bank’s operating licence.
NDIC, in accordance with Section 12(2) of the Banks and Other Financial Institutions Act (BOFIA) 2020 and Section 55(1 and 2) of the NDIC Act 2023, immediately commenced the process of verification and payment to insured depositors up to a maximum insured deposit of N5 million within four days.
The corporation said this was achieved using the BVN as a unique identifier to locate depositors’ alternate accounts in other banks.
Heritage Bank's licence was revoked due to its poor financial performance, which the CBN said constituted a threat to financial stability as the bank “has continued to suffer and has no reasonable prospects of recovery.”
Also, customers of the now-revoked Heritage Bank lamented their inability to carry out transactions with the bank months before the revocation of the bank’s licence due to various reasons.
Heritage Bank: What happens to depositors’ funds when a bank’s licence is revoked? (Explainer)
Meanwhile, TheRadar reported that Nigerians woke up on Monday, June 3, to the news of the revocation of the operating licence of Heritage Bank by the CBN to ensure public confidence in the financial system as the bank’s non-performance is a threat to financial stability.
Following this, TheRadar explained what becomes of depositors’ and shareholders’ funds in the event of a revocation of a bank’s licence.
