The Nigeria Deposit Insurance Corporation (NDIC) has commenced the disbursement of ₦46.6 billion in liquidation dividends to depositors of the defunct Heritage Bank.
This initiative follows the realization of funds from the sale of the bank’s assets and the recovery of outstanding debts.
Background
Heritage Bank‘s operating license was revoked by the Central Bank of Nigeria (CBN) on June 3, 2024, due to the bank’s persistent financial instability and failure to meet regulatory requirements, as stipulated under Section 12 of the Banks and Other Financial Institutions Act (BOFIA) 2020.
Subsequently, the NDIC was appointed as the liquidator to manage the bank’s closure and ensure the protection of depositors’ funds.
NDIC’s Mandate and Actions
Under Section 62 (1)(d) of the NDIC Act, 2023, the corporation is empowered to act as a liquidator for failed banks.
In line with this mandate, the NDIC began the payment of insured deposits, up to a maximum of ₦5 million per depositor, within four days of the bank’s closure.
This swift action was facilitated by leveraging Bank Verification Numbers (BVN) to identify and reimburse depositors through their alternate bank accounts.
As of September 2024, the NDIC had successfully settled approximately 84.98% of the insured depositors of Heritage Bank.
The remaining depositors are those with accounts facing issues such as Post No Debit (PND) restrictions, lack of BVN, or absence of alternate bank accounts.
Liquidation Dividends for Uninsured Depositors
For depositors with funds exceeding the insured limit of ₦5 million, the NDIC has initiated the payment of liquidation dividends.
These payments are sourced from the proceeds of the sale of Heritage Bank’s assets and the recovery of debts owed to the bank.
The NDIC has commenced a nationwide auction of the bank’s landed properties and physical assets across 36 locations, starting from December 4, 2024, to facilitate this process.
The corporation has emphasized its commitment to ensuring that all depositors, including those with uninsured deposits, receive their due funds.
Additionally, the NDIC has stated that creditors of the defunct bank will be paid after all depositors have been fully reimbursed, following the priority of claims as outlined in the liquidation process.
