Heritage Bank: NDIC to pay customers with above N5m deposits through liquidation dividends
The Nigeria Deposit Insurance Corporation (NDIC) has assured depositors with above N5million in the defunct Heritage Bank of reimbursement through the liquidation of the Bank’s dividends.
NDIC’s Managing Director and Chief Executive Officer, Mr. Bello Hassan made this known during the opening session of the 2024 NDIC Business Editors and Finance Correspondents Association of Nigeria (FICAN) workshop held in Lagos.
Mr. Hassan assured that the Corporation is committed to reimbursing depositors with balances exceeding N5 million.
He disclosed that the Bank has paid approximately 84.98 percent of Heritage Bank customers whose accounts were linked with Bank Verification Numbers (BVN).
Recalling the closure of Heritage Bank, the NDIC Chief noted that following the revocation of its licence by the CBN on June 3, 2024, the NDIC is playing an essential role in safeguarding depositors.
“The Corporation began the payment of the insured deposits of N5 million maximum per depositor within a record time of four days of the bank’s closure. This was achieved using Bank Verification Numbers (BVN) as a unique identifier to locate depositors’ alternate accounts in other banks without the need to fill forms or visit the NDIC offices.”
He added, “This innovative approach has indeed enabled the payment of 84.98 percent of depositors with BVN linked accounts to date. The prompt payment of depositors, coming at a time when the Corporation had also recently increased the deposit insurance coverage from N500,000 to N5 million in Deposit Money Banks, significantly cushioned the negative impact of bank failure, especially during the current challenging economic climate.”
“This achievement is consistent with the provisions of the International Association of Deposit Insurers (IADI) Core Principle 15, which emphasises timely payouts to depositors of failed banks.”
He said, “These uninsured deposits represent a significant portion of the total deposits in Heritage Bank. In this regard, the Corporation is already working assiduously to ensure that all depositors with amounts in excess of the maximum insured amount of N5 million are paid through liquidation dividends from the realisation of the defunct bank’s assets and recovery of debts.”
The NDIC Chief added further that, “The Corporation has already initiated the process of debt recovery and realisation of investments and physical assets of the defunct bank to ensure timely payment of the uninsured deposits.”
“This orderly process, based on asset realisation and priority of claims, is essential in maintaining public trust in the banking system and promoting financial stability. The handling of the Heritage Bank liquidation illustrates the broader role of the NDIC in ensuring that even in times of financial disruption, depositors can rest assured that their funds are protected.” He emphasized.
