Heritage Bank: NDIC Begins Uninsured Depositors’ Payment From April

The Nigeria Deposit Insurance Corporation (NDIC) has announced that it will begin payments to depositors of the defunct Heritage Bank who held balances exceeding the insured limit of N5 million by April 2025.

This follows significant progress in the liquidation process after the revocation of the bank’s license by the Central Bank of Nigeria (CBN) on June 3, 2024.

In line with its statutory mandate, the NDIC, days after the revocation of Heritage Bank’s license had commenced the bank’s liquidation process, including the verification and payment of insured deposits to all depositors.

It had also commenced the disposal of the assets of the bank to enable it pay the uninsured deposits, creditors and shareholders of the bank. acting director, Communications and Public Affairs of the corporation, Hawwau Gambo, noted that while depositors with balances above N5 million have been paid the initial insured sums of the N5 million, the remaining balance in excess of the insured sum of the N5 million already reimbursed, will be paid as liquidation dividends in accordance with the Corporation’s statutory mandate.

According to her, the NDIC had made substantial progress in disposing the physical assets and recovering some of the debts of the failed bank to ensure that depositors with balances above the maximum insured limit receive their payments as soon as possible.

“As a clear demonstration of this commitment, the Corporation commenced the realisation of physical assets and investments as well as aggressive recovery of the risk assets, concurrently with the verification and payment of insured sums. To ensure transparency and compliance with legal requirements, the NDIC has widely advertised the asset disposal process on its official website, social media platforms, and major national newspapers, as well as through radio and television announcements.

“The Corporation’s approach of simultaneously paying insured depositors while aggressively pursuing asset sales and debt recovery is designed to accelerate the liquidation process and ensure that all depositors receive their funds without unnecessary delays. With the considerable progress recorded in the asset realization, the Corporation will declare the first tranche of liquidation dividends in April 2025 which will be paid to uninsured depositors on a pro-rata basis, in line with Section 72 of the NDIC Act 2023 on the priority of claims.

Citing the NDIC Act 2023, Gambo noted that “For clarity, the referenced section states that: “Where an insured institution is unable to meet its obligations or suspends payment, or where its management and control have been taken over by the Central Bank of Nigeria following the revocation of its license, the assets of the insured institution shall be available to meet its deposit liabilities. Such deposit liabilities shall have priority over all other liabilities of the insured institution.” Consequently, other claimants of the failed Heritage Bank, including creditors, and shareholders, will be considered for payment of liquidation dividends only after all depositors have been fully reimbursed.