The Nigeria Deposit Insurance Corporation (NDIC) has announced its intention to pursue debtors of Heritage Bank.
The NDIC also stated it would compensate depositors of the now-closed Heritage Bank who have N5 million or less in their accounts.
Appointed by the Central Bank of Nigeria as the bank’s liquidator, the NDIC plans to complete these payments within one week.
At a press conference in Abuja, NDIC Managing Director Bello Hassan shared that 99% of the 2.3 million depositors had N5 million or less in their accounts.
Hassan said,
“Our primary objective is to protect depositors and maintain financial system stability. We will start by paying depositors the maximum insured amount of N5m, leveraging the Bank Verification Number facility.”
“Our focus is on depositors and creditors, with depositors taking priority. We will start by paying depositors the maximum insured amount of N5m. Depositors with alternate bank accounts can visit any NDIC branch for payment, while those without can use the NDIC website to claim their insured amount.”
The NDIC will later focus on reimbursing uninsured deposits and creditors using funds from the sale of the bank’s assets.
With deposits of about N650 billion and loans totaling N700 billion, the NDIC is determined to recover as much as possible, using the authority granted by the NDIC Act 2023. Hassan assured that the agency would utilize its powers effectively to achieve this.
He said,
“After paying depositors, we will move on to creditors. Our preliminary assessment shows total deposits of around N650bn, with loans exceeding N700bn.
“We aim to recover these loans, empowered by the NDIC Act 2023, which provides a sufficient legal framework for debt recovery. We assure the public that we will leverage these powers to recover as much as possible, starting immediately,”
On Monday, the CBN announced the revocation of Heritage Bank’s license due to regulatory breaches, as stated by the Acting Director of Corporate Communication, Sidi Ali.
Customers of Heritage Bank gathered at the bank’s Lagos headquarters on Wednesday, seeking information on retrieving their deposits.
The regulator said,
“This action has become necessary due to the bank’s breach of Section 12 (1) of BOFIA, 2020. The board and management of the bank have not been able to improve the bank’s financial performance, a situation which constitutes a threat to financial stability.
“This follows a period during which the CBN engaged with the bank and prescribed various supervisory steps intended to stem the decline. Regrettably, the bank has continued to suffer and has no reasonable prospects of recovery, thereby, making the revocation of the license the next necessary step.”
Security guards prevented customers from entering the premises.
An official addressed customers through the gate, saying that payments to savings account holders had started and would continue until Friday.
Corporate account holders were advised to return “next week,” causing concern among some who noted that Bank Verification Numbers (BVN) are usually linked to individual accounts, not corporate ones.
“You don’t need to take any action. NDIC staff are already processing payments. Your money will be transferred to your other account linked with your BVN,” the official assured them.
The atmosphere remained tense as customers declined interviews with the News Agency of Nigeria (NAN).
A NAN correspondent’s attempt to enter the premises was blocked by security personnel, who cited the CBN’s June 3 press release about the license revocation as their only comment.
