Tag: Heritage Bank

The Nigeria Deposit Insurance Corporation (NDIC) has started payment of N46.6 billion in liquidation dividends to depositors of the defunct Heritage Bank.

This is contained in statement on Sunday by Hawwau Gambo, Acting Head, Communication and Public Affairs.

She said the funds were realised from sales of the bank’s assets and recovery of debts owed.

Gambo explained that a liquidation dividend is paid to depositors of a closed bank, beyond the maximum insured limit, using proceeds from asset sales and debt recovery.

She added that liquidation dividends may also cover payments to creditors and shareholders once all depositors have been fully reimbursed.

The NDIC began payment of the first tranche of liquidation dividends on April 25.

According to Gambo, the initial dividend is paid at 9.2 kobo per Naira on a pro-rata basis to depositors with balances above N5 million.

She noted that further payments would be made as more assets of the defunct bank are realised and outstanding debts recovered.

Following the revocation of Heritage Bank’s licence by the Central Bank of Nigeria (CBN) on June 3, 2024, NDIC immediately reimbursed insured deposits up to N5 million.

To ensure a seamless process, NDIC used depositors’ Bank Verification Numbers (BVN) to locate alternate accounts and automatically credit the insured amounts.

The Corporation also used existing records from insured payments to disburse the first tranche of liquidation dividends.

“Depositors with balances exceeding N5 million who did not receive their liquidation dividends should visit the nearest NDIC office.

“Depositors without alternative bank accounts, who were not paid the insured amount, should also visit NDIC offices or download forms from www.ndic.gov.ng.

“Depositors must complete and submit a deposit verification form to receive their insured amounts and, where applicable, the first tranche of dividends,” Gambo said.

She reiterated NDIC’s commitment to ensuring the recovery of assets and the reimbursement of all eligible depositors.

The Nigeria Deposit Insurance Corporation (NDIC) says it would begin the payment of the first tranche of liquidation dividends to depositors of Heritage Bank from April.

It would be recalled that Heritage Bank operating licence was revoked by the Central Bank of Nigeria (CBN) on June 3, 2024.

The Managing  Director of NDIC, Mr Bello Hassan, said this on Wednesday at the NDIC Special Day at the ongoing 36th Enugu  International Trade.

Represented by Mrs Pamela Robert, South-East Coordinator of NDIC, Hassan said that NDIC was in collaboration with the CBN to maintain stability in the banking sector, enforce compliance with banking regulations and exercise effective oversight over insured deposit-taking institutions.

According to him, NDIC have commenced preparations to pay the first tranche of liquidation dividends this month of April.

“I wish to reassure all depositors that the NDIC has the financial and operational capacity to fully reimburse all depositors as recoveries are made,” he said.

Hassan said that the approach of paying insured deposits while concurrently realising assets and recovering loans ensured that no depositor was left behind.

The managing director emphasised that as more recoveries were made, subsequent tranches of liquidation dividends would follow.

“Our record in bank liquidation is reassuring. NDIC has successfully declared fully liquidation dividends to depositors of 20 previously failed banks.

“This reflects our unwavering commitment to depositor protection and our proven capacity to manage bank failures effectively.

“Therefore, I urge depositors of closed banks, particularly Heritage Bank, who have not yet received their payments, to come forward and provide necessary documentation supporting ownership of the account.

These, he said, included the Bank Verification Number (BVN), and alternate bank account number for payment of the insured sum.

“Claims can be submitted through our website, email, social media platforms, or by visiting any of our Zonal Offices,” he said.

He said that the NDIC had consistently played a crucial role in maintaining financial stability by ensuring depositors receive prompt compensation when banks failed.

“A recent example is the revocation of Heritage Bank’s operating license by the CBN.

“In line with its statutory mandate, the Corporation immediately began liquidation process, including verification and payment of insured deposits of up to a maximum of ₦5 million per depositor within four days.

“This swift action has enabled the payment of insured amounts to the majority of the bank’s depositors using their BVN as a unique identifier to locate their alternate accounts for payment.

“Those yet to be paid are largely depositors without BVNs or alternate accounts in other banks, or those with Post-No-Debit (PND) restrictions.

“Some accounts also have KYC issues, such as Tier 1 limits or name mismatches, while a few depositors may be unaware that payments have been made due to lack of transaction alerts on the alternate accounts,” he added.

Chief Odeiga Jideonwo, the President of the Enugu Chamber of Commerce, Industry, Mines and Agriculture (ECCIMA) commended  NDIC for its operations.

The president however, called on the corporation to improve on its level of compensation paid to depositors when banks went under.

“It is indeed a big challenge and we hope that the NDIC would increase the percentage of money paid to depositors depending on the total amount of deposit each customer has in the bank,” Jideonwo said.

He also pleaded that the CBN through its regulatory framework should make the work of NDIC easier by ensuring that chances of bank failure was reduced to the barest minimum and guard against depositors going through this negative experience.

The Nigeria Deposit Insurance Corporation (NDIC), says plans are ongoing to pay depositors of the defunct Heritage Bank whose deposits exceed N5 million.

The Managing Director of NDIC, Mr Bello Hassan said this at the 2024 workshop for Financial Correspondents Association of Nigeria (FICAN) in Lagos on Thursday.

He said the Corporation was working to ensure that the depositors who had above N5 million with the bank got paid through the liquidation dividends.

Hassan said the Corporation had also commenced debt recovery to ensure the payment.

”We are making concerted effort to cover the assets in terms of physical assets and debts in liquidation dividends which have already commenced,” he said.

On payment of insured deposits to depositors of the defunct bank, he said the Corporation had paid substantially all insured depositors.

”The only group of insured depositors that we have not paid are those with no alternate account and have not come forward to provide the alternate account so that we can pay them.

”Also, insured depositors whose account is on post no debit order either by order of court or by regulatory agencies due to issues around fraud and Know-Your-Customer (KYC) have not been paid.

”Once those orders are vacated, we are going to pay them,” he said.

Hassan assured that the Corporation would continue to do all within its mandate to ensure stability in the financial system.

He said that confidence was key in maintaining stability in the financial system.

The News Agency of Nigeria (NAN) reports that the NDIC had in an advertorial listed the assets of the defunct bank nationwide for sale.

The NDIC had announced the sale of the defunct bank properties and chattel, including vehicles, office equipment and machinery in 62 locations across the country.