In a significant move to assist depositors following the closure of Heritage Bank, the Nigeria Deposit Insurance Corporation (NDIC) has announced that it will commence payment of the first tranche of liquidation dividends starting this April. This announcement comes in the wake of the Central Bank of Nigeria's (CBN) decision to revoke Heritage Bank’s operating license on June 3, 2024.
The announcement was made by Mr. Bello Hassan, Managing Director of NDIC, during a special event at the 36th Enugu International Trade Fair on April 9. He was represented by Mrs. Pamela Robert, the NDIC’s South-East Coordinators.
Hassan emphasized the NDIC's unwavering commitment to maintaining financial stability within the sector. He noted that the NDIC is collaborating closely with the CBN to ensure strict adherence to banking regulations and effective oversight of insured deposit-taking institutions. Preparations for the payment of the liquidation dividends to Heritage Bank depositors have been underway, he disclosed.
“Rest assured, we have the financial and operational capacity to reimburse all affected depositors as we recover assets,” Hassan stated. The NDIC's approach includes paying insured deposits while also working to recover loans and liquidate bank assets, ensuring no depositor is overlooked in the process.
Hassan highlighted the NDIC's strong track record in managing bank failures, noting that it has previously paid full liquidation dividends to depositors of 20 failed banks. This history demonstrates the NDIC's commitment to protecting depositors and effectively handling bank closures.
For those affected by the Heritage Bank closure, Hassan urged depositors who have not yet received their payments to submit the necessary documentation, including their Bank Verification Number (BVN) and an alternate bank account number. Claims can be filed through the NDIC's website, email, social media platforms, or by visiting any zonal office.
In his remarks, Hassan praised the rapid response to Heritage Bank’s licence revocation. The NDIC initiated the liquidation process immediately and managed to pay insured deposits up to a maximum of N5 million per depositor within just four days. Most depositors received their payments by using their BVNs to identify alternate bank accounts.
However, he acknowledged that some depositors have yet to receive their payments due to various issues, including missing BVNs or alternate bank accounts, Post-No-Debit (PND) restrictions, Know Your Customer (KYC) challenges, and mismatched names. He also noted that some customers may not have been aware of their payment status due to a lack of transaction alerts.
During the event, Chief Odeiga Jideonwo, President of the Enugu Chamber of Commerce, Industry, Mines and Agriculture (ECCIMA), commended the NDIC for its vital role in stabilizing the financial sector. He urged the agency to improve compensation levels for depositors of failed banks by considering raising the percentage of money paid based on each customer's total deposit.
Jideonwo also called for the CBN to strengthen its regulatory framework to reduce the occurrence of bank failures and protect depositors from the distress of losing access to their funds.
As the NDIC prepares to disburse funds to Heritage Bank depositors, it aims to reinforce confidence in the financial system and support those adversely affected by banking failures.
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