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  • Reason for delay in payment of Heritage Bank customers – NDIC

    Reason for delay in payment of Heritage Bank customers – NDIC

    The Nigeria Deposit Insurance Corporation (NDIC) says account names discrepancies in Bank Verification Number (BVN) linked alternate account of some defunct Heritage Bank customers is delaying the payment of their insured deposits.

    Mr Bello Hassan, the Managing Director of NDIC disclosed this on Sunday in Abuja.

    Hassan said the corporation had paid substantial amount to depositors of the defunct bank without BVN account linked issues.

    He called on depositors of the bank who were yet to receive their insured deposit credit alert to visit the NDIC’s website and complete their verification forms for their payment.

    The managing director said the verification would also include depositors without BVN alternate account.

    ”We have already commenced the payment of customers since June 6.

    ”We have paid substantial amount to the customers.

    ”What we leverage in making the payment is BVN of customers. We trace alternate accounts in other banks and pay them their insured amounts.

    ”There are some that we have challenges linking up because of some discrepancies between the names and others.

    ”We are calling on customers that have not received their alerts in their alternate accounts to come forward and complete their verification forms so that we can pay them,” he said.

    On payment of depositors with more than five million naira with the bank, Hassan said they would be paid liquidation dividend.

    According to him, NDIC have already commenced the process of disposing the physical buildings and also set the process in motion to make sure that we recover the loans and advances that were granted the bank.

    ”That is what we use in paying those liquidation dividends.

    ”We are not going to wait until we recover everything, no.

    ”As we recover, we will also advertise to say that we will pay liquidation dividends so that concerned depositors will be on the look out for alerts in their accounts,” Hassan said.

    Recall on June 3, the Central Bank of Nigeria (CBN) revoked the banking licence of Heritage Bank Plc.

    CBN said the decision was made due to the bank’s failure to improve its financial performance, posing a threat to financial stability.

    NAN

  • NDIC puts defunct Heritage Bank assets for sale

    NDIC puts defunct Heritage Bank assets for sale

    The Nigeria Deposit Insurance Corporation, NDIC has listed the head office in Lagos and branches of failed Heritage Bank across the country for sale in its role as liquidator of the bank.

    NDIC announced the sale of the bank properties numbering 48 and its chattel including vehicles, office equipment, plant, and machinery in another 62 locations across the country in an advertorial published in The PUNCH on Thursday.

    “The Nigeria Deposit Insurance Corporation in the exercise of its right as Liquidator of failed Deposit Money Banks hereby invites interested members of the general public to buy the assets (landed property and chattels) of defunct Heritage Banks through public competitive bidding,” part of the advertorial read.

    The head office of the bank and its annex located at 143 Ahmadu Bello Way and 130 Ahmadu Bello Way, Victoria Island, Lagos was listed for sale (buildings, chattels, generator, and motor vehicle). Also listed for sale were six other branches in Lagos, four branches in Abuja, four in Rivers States, and the others spread across the country.

    Interested parties are invited to come for an inspection and subsequently put in bids on the assets to be submitted to the NDIC office in Lagos.

    Bids are expected to come in with 10 per cent of the bid amount in Certified Bank Draft. Successful bidders will be required to pay the balance of the bid price within two weeks of notification.

    Earlier, the corporation announced the commencement of the verification and payment of the depositors of the bank with N5m or less in their accounts. This category of customers makes up about 99 per cent of the bank customers.

    The Managing Director of the NDIC, Bello Hassan, at a media briefing on the liquidation of Heritage Bank in Abuja last Wednesday, put the total depositors at Heritage Bank at 2.3 million.

    Hassan noted that the total bank deposits at Heritage Bank stood at N650bn  while its loan portfolio was about N700bn

    In announcing the revocation of the licence of Heritage Bank, the apex bank in a statement signed by the Acting Director of Corporate Communication, Sidi Ali, 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 licence the next necessary step.”

  • Heritage Bank customers besiege headquarters for payment

    Heritage Bank customers besiege headquarters for payment

    Customers of the liquidated Heritage Bank Plc gathered at the bank’s headquarters in Lagos on Wednesday, to seek clarification on the beginning of their deposit payments.

    A visit by a correspondent on Wednesday revealed that security personnel stationed at the bank’s entrance prevented customers from entering the premises.

    Addressing the customers through the gate, an official informed them that payments had begun for savings account holders and would

    continue until Friday.

    “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.

    However, corporate account holders were advised to return “next week,” leading to concerns among some who noted that BVN is typically associated with individual accounts, not companies.

    The atmosphere remained sombre as customers declined interviews.

    A customer simply stated, “Mine is an entrepreneurship account.”

    Efforts by a correspondent to gain entrance were thwarted by security personnel, who referred to the Central Bank of Nigeria’s press release dated June 3, announcing the revocation of the bank’s licence, as the response to all inquiries.

    CBN revoked Heritage Bank Plc’s licence on Monday, citing a breach of Section 12 (1) of BOFIA, 2020, and appointed the Nigeria Deposit Insurance Corporation (NDIC) as the liquidator.

    NDIC Managing Director, Mr Bello Hassan, disclosed at a news conference in Abuja that 99 per cent of Heritage Bank depositors had total balances less than N5 million.

    He assured that payments would start before the end of the week, with insured benefits capped at N5 million.

    According to him, those with deposits exceeding N5 million would be paid after sale of the bank’s assets.

    He added that payments would begin before the end of the week.

  • Heritage Bank: NDIC begins payment of depositors’ insured sum

    Heritage Bank: NDIC begins payment of depositors’ insured sum

    The Nigeria Deposit Insurance Corporation (NDIC), says it will begin payment of insured sum to 2.3 million depositors of Heritage Bank in-liquidation this week.

    The Managing Director of NDIC, Mr Bello Hassan, said this while briefing newsmen in Abuja on Wednesday.

    Hassan said the bank had preliminary deposits of N650 billion and loan worth N700 billion.

    According to him, 99.9 per cent of depositors of the defunct bank have a deposit balance of less than five million naira, while only 4,000 of the depositors have more than five million naira deposit.

    Recall that on Monday, CBN revoked Heritage Bank’s license.

  • NDIC begins liquidation of Heritage Bank

    NDIC begins liquidation of Heritage Bank

    The Nigeria Deposit Insurance Corporation (NDIC) says it has started the liquidation process of Heritage Bank with immediate verification and payment of insured deposits to bank depositors.

    Recall that on Monday, CBN revoked Heritage Bank’s license.

    Mr Bashir Nuhu, Director of Communications and Public Affairs, NDIC, in a statement, said that relevant laws necessitated immediate actions to safeguard depositors’ funds.

    “Following the revocation of the banking license of Heritage Bank Plc by the Central Bank of Nigeria (CBN) today, June 3, 2024 and the appointment of the Nigeria Deposit Insurance Corporation (NDIC) as the liquidator, pursuant to Section 12(2) of BOFIA, 2020,

    “The corporation wishes to announce to depositors of the bank in particular and the banking public in general, as follows:

    “The NDIC has commenced the Liquidation of Heritage Bank Plc in accordance with Section 55 sub-section 1 & 2 of the NDIC Act 2023

    “The corporation has also commenced the liquidation process of the failed bank with immediate verification and payment of insured deposits to the bank depositors.”

    He explained the payment options to various categories of the bank’s depositors.

    “Depositors of the bank that have alternate accounts within the industry will be paid up to the insured amount of N5 million per depositor using their Bank Verification Number (BVN) to locate their alternate account.

    “While depositors with funds in excess of N5 million will be paid liquidation dividend upon realisation of the bank’s assets and recovery of debts owed to the bank,” he said.

    Nuhu advised all depositors of the defunct bank without alternate bank accounts in the industry to visit the nearest branch of the bank with proof of account ownership, and verifiable means of identification.

    He listed the required documents to include a driver’s license, permanent voter’s card, National Identity Card, together with an alternate account and BVN for the verification of deposits and subsequent payment of insured sums.

    He added that depositors could also file online claims by visiting the NDIC website claims page on www.ndic.gov.ng/claims/claims, download and fill the claims forms and upload the required documentation.

    He advised creditors to visit the nearest branch of the bank to file their claims or via the online platform.

    “Please note that the process of payment of creditors will commence immediately after all depositors have been paid,” Nuhu said.

    He advised debtors who had not completed repayment of loans to contact the Corporation’s Asset Management Department (AMD).

    “Visit the NDIC website for more details. The NDIC wishes to assure the entire banking public of its commitment to the continued safety of depositors’ funds in all licensed banks.

    “As such, depositors are urged to continue their banking businesses without fear as banks whose licenses have not been revoked remain safe and sound,” he said.

  • NDIC increases maximum deposit insurance coverage for failed banks

    NDIC increases maximum deposit insurance coverage for failed banks

    The Nigeria Deposit Insurance Corporation (NDIC), has reviewed upward the maximum deposit insurance coverage for depositors of all licenced deposit taking financial institutions in event of bank failure.

    Deposit insurance is the government’s guarantee that an account holder’s money at an insured bank is safe up to a certain amount.

    The Managing Director of NDIC, Mr Bello Hassan, told newsmen in Abuja that the deposit insurance coverage level for Deposit Money Banks (DMBs) were reviewed from N500,000 to five million naira.

    Bello said on Thursday, that the insurance coverage for Micro-finance Banks (MFBs) had been increased from N200,000 to two million Naira, which would provide 99.27 per cent coverage of total depositors.

    He said that Primary Mortgage Banks (PMBs) were increased from N500,000 to two million naira with full coverage of 99.34 et cent compared with the current 97.98 per cent.

    For subscribers of Mobile Money Operators (MMOs), he said that the deposit insurance coverage had increased from N500,000 to five million per subscriber, per MMO.

    Bello said the Payment Service Banks (PSBs) insurance coverage had also increased from N500,000 to two million naira.

    He said the adoption of the revised maximum deposit insurance coverage would be supported by the Corporation’s funding, represented by the balances in the various Deposit Insurance Funds (DIFs) and expected annual premium collection.

    Other support would be enhanced supervision to reduce the likelihood of bank failures, effective bank resolution frameworks and other funding arrangements provided by the NDIC Act.

    Bello said that factors considered in the upward review of the coverage level were deposit distribution, impact of inflation, per capita Gross Domestic Product (GDP), exchange rate and other statistical models.

    ”NDIC’s mandate of Deposit Guarantee is a critical component of depositors’ protection, as it guarantees the payment of deposits up to a maximum set limit in the event of bank failure.

    ”The deposit guarantee, covers depositors of all deposit taking financial institutions licenced by the Central Bank of Nigeria (CBN) , which include DMBs, MFBs, PMBs, Non-Interest Banks (NIBS), Payment Service Banks (PSBs) and subscribers of MMOs.

    ”We need to stress that the high level of uninsured deposits posed a risk of bank runs.

    ”This is in line with our commitment to enhancing depositors’ protection, public confidence, financial inclusion, and stability of the financial system.

    “I am pleased to announce that the NDIC’s Interim Management Committee (IMC), approved an increase in the maximum deposit insurance coverage levels for all licenced deposit taking financial institutions.

    ”The revised deposit insurance coverage has balanced the NDIC’s goals of deposit protection and financial system stability with incentives for depositors to practice market discipline and prevent banks from unnecessary risk-taking and moral hazard.

    ”Consideration was given to ensure that the coverage was limited but adequate enough to protect a large number of depositors,” he said.

    The managing director reaffirmed the Corporation’s commitment to protecting depositors and contributing to the stability of the financial system.

  • NDIC pays over N1.7bn to customers of closed banks

    NDIC pays over N1.7bn to customers of closed banks

    Nigeria Deposit Insurance Corporation (NDIC) says it has paid insured sum of over N1.7 billion to customers, following the revocation of licenses of Microfinance Banks (MFBs) and four Primary Mortgage Banks (PMBs).

    Mr Bello Hassan, Managing Director/Chief Executive Officer, NDIC, said this at the 2023 NDIC Editors Forum, on Saturday in Lagos.

    The meeting had the theme, “Stocktaking of Deposit Insurance Practice: Assessing the Past, Evaluating the Present and Forecasting the Future.”

    Hassan said, “recall earlier this year the Central Bank of Nigeria revoked the licenses of 183 institutions comprising Microfinance Banks and Primary Mortgage Banks.

    “And we quickly advertised and told affected depositors to get the required documents and come forward for verification so that we can pay them the insured amount.

    “So, in terms of insured amount, we have paid more than 1.7 billion to more than 22,000 customers and we are calling on those customers that had no Bank Verification Number attached to their accounts to come forward to get their claims verified so that we can pay them the insured amount.

    “We are still on that. So, I’m using this opportunity to appeal to those depositors to come forward so that they can be verified and their claims paid.”

    The insured deposit is the first claim that NDIC pays to depositors upon revocation of a bank’s licence by the CBN.

    The maximum specified limits for the MFB and PMB sub-sectors are N200, 000 and N500, 000 per depositor per bank, respectively.

    The NDIC boss said the Deposit Insurance System implemented by the corporation was an important component of the nation’s financial safety net.

    He said the corporation’s operations focused on minimising banks’ risks and failures through strict banking supervision, reimbursement of insured depositors in the event of failure, and orderly liquidation of failed banks.

    “It complements the efforts of the Central Bank of Nigeria to achieve a secure and stable banking system as well as support the fiscal authority in maintaining stability within the broader financial system, serving as the foundation for economic growth and development,” he said.

    Hassan also said the corporation, like other financial safety net players in Nigeria, had been faced with similar challenges that had impacted the nation’s financial system.

    These challenges, he said, were caused by two main factors: macroeconomic factors and the changing dimensions of the financial services industry.

    “Though some of the challenges are universal, others are unique and domesticated.

    “It is within this context that the NDIC aligns itself with the Central Bank of Nigeria’s efforts towards strengthening the banking industry through enhancing prudential thresholds and other regulatory instruments,” Hassan said.

    NAN

  • NDIC to pay N16.18bn liquidation dividends of 20 failed banks

    NDIC to pay N16.18bn liquidation dividends of 20 failed banks

    The Nigeria Deposit Insurance Corporation (NDIC) says it is prepared to conduct 100 per cent liquidation dividend payments worth N16.18 billion for depositors of 20 failed banks.

    Already the corporation has asked depositors to come forward for verification and payment of their deposits that are in excess of the guaranteed sums, otherwise called “liquidation dividends”.

    The NDIC Managing Director, Mr Bello Hassan, disclosed this during the NDIC Day at the ongoing 44th Kano International Trade Fair in Kano.

    He gave the names of the affected banks as Liberty Bank, City Express Bank, Assurance Batik, Century Bank, Allied Bank, Financial Merchant Bank, Icon Merchant Bank, Progress Bank, Merchant Bank of Africa (MBA), Premier Commercial Bank, North South Bank and Prime Merchant Bank.

    He also listed Commercial Trust Bank, Cooperative and Commerce Bank, Rims Merchant Bank, Pan African Bank, Fortune Bank, All States Trust Bank, Nigeria Merchant Bank and Amicable Bank.

    Hassan said following the recent revocation of licenses for 179 Microfinance banks (MFDS) and four Primary Mortgage Banks (PMBS) by the Central Bank of Nigeria, the NDIC immediately commenced liquidation of the banks and began disbursing Insured sums to the depositors within just seven days of the closure of the microfinance banks.

    “It is Important to note that out of these, the NDIC has paid N1.5 billion to 41,034 depositors of 129 MFBs and PMBs,” he said.

    According to him, the payments are still ongoing and depositors with funds exceeding the standard will receive liquidation dividends after recovery of debts and sale of physical assets of the closed banks.

    The managing d irector said it was imperative to note that in the unfortunate event of bank failure, the insurance coverage for depositors varies across different banking institutions.

    “While depositors of Deposit Money Banks, Primary Mortgage Banks, Non-Interest Banks, Payment Service Banks, and subscribers of Mobile Money Operators are insured up to a maximum limit of N500,000 per depositor per bank; for depositors of Microfinance Banks, the maximum insurance Limit stands at N200,000 per depositor per bank.

    “These insured limits undergo process reviews by the Board of the Corporation, ensuring comprehensive coverage for the majority of depositors.

    “Furthermore, depositors holding licenses exceeding the insured sums receive regular payments of the excess in the form of liquidation dividends, that also extends to the benefit of creditors and shareholders of the respective banks,” he explained.

    He assured that the NDIC would continue to work in collaboration with the Central Bank of Nigeria to ensure effective supervision of banks and adherence to procedures, guidelines and the Code of Corporate Governance for banks, which safeguards the safety and stability of the Nigeria Banking system.

    He called on the general public, especially traders and businessmen, to always ensure that their funds are saved in licensed banks and not kept in their homes or shops to avoid the risks of fire, theft and armed robbery.

  • NDIC to probe directors, officers of revoked 183 MFBs, PMBs

    NDIC to probe directors, officers of revoked 183 MFBs, PMBs

    The Nigeria Deposit Insurance Corporation (NDIC) will begin the investigation of the directors and officers of the 183 banks whose licences were revoked earlier this year.

    The Managing Director of the NDIC, Mr Bello Hassan, said this at a one-day capacity building workshop for law enforcement agencies on Thursday in Lagos.

    He said the law enforcement agencies including the Economic and Financial Crimes Commission (EFCC) and the Nigerian police, among others, would soon be called to investigate sharp practices by the directors of these defunct banks.

    “As you are all aware, the Central Bank of Nigeria recently revoked banking licenses of 183 MicroFinance Banks (MFBs) and Primary Mortgage Banks (PMBs) which may require you to be called upon to investigate some of the directors and officers of these institutions with a view to bring to book those found culpable in the collapse of these institutions,” he said.

    Hassan, represented by Mr Henry Fomah, Head of Legal Department of NDIC, noted that through collaborative efforts of agencies, 12 prosecution cases were currently on-going at various courts.

    “There are 25 on-going investigation at the Nigeria Financial Intelligence Unit (NFIU), 11 with the EFCC and five concluded investigations with the Federal Ministry of Justice for advice and prosecution,” he said.

    According to him, this indicates that the corporation as well as other government agencies are on the right course through collaboration.

    This, he said, would bring to book errant directors, officers, managers of these banks that led to their collapse adding that a stable financial system could not be guaranteed if the banking industry was not well sanitised.

    “The corporation, whilst bearing in mind the positive impact of such collaboration will continue to strive at enhancing the synergy between all of us in the areas of law enforcement relating to investigation and prosecution of financial malpractices.

    “I want to use this forum to appeal to the members of the task force not to relent on your oars but to execute the given mandate diligently thereby achieving the objectives of establishing the task force,’’ he said.

    He added that the corporation was not unaware of the challenges of investigating and prosecuting financial malpractices and bank fraud cases urging officers not to relent in their efforts.

    The NDIC boss noted that the advancements in information technology with new possibilities in banking operations had equally exposed the banking subsector to emerging threats.

    He said the situation had increased the burden on the regulators and supervisors to enhance their operational capacities as well as heightened the need for more collaboration between agencies involved in the fight against banking malpractices.

    “This workshop is, therefore, among the steps taken to provide a platform for the agencies concerned to sharpen their skills, share ideas and be well-equipped to face the challenges.

    “We recognise that, for the corporation to achieve its mandate and objectives in a more efficient and effective manner; and for the banking system to thrive on the gains of a stable financial system; we must all rise up to the challenge of bringing to book those who might have contributed to the failure of their banks,’’ Hassan said.

    Mr Kofo Salam-Alada, the Head of Legal Services at CBN, said it was essential for agencies that would collaborate with regulators to have deep insight into how regulators operate.

    “A lot of gaps have been seen which is why we must commend the Nigerian Deposit Insurance Corporation for having been the vanguard of sponsoring capacity building exercises for the past 12 years,” Salam-Alada said.

    The aim of the workshop is to equip officers involved in the investigation and suspicion of financial malpractices in the banking system with necessary skills required to carry out their duties diligently, with particular focus on failed banks.

    The workshop will also enhance their skills and knowledge as law enforcement officers and/or staff of agencies involved one way or the other in the investigation of banking malpractices with special emphasis on distressed banks.

  • Fraudsters getting more creative – Bank customers warned

    Fraudsters getting more creative – Bank customers warned

    The Nigeria Deposit Insurance Corporation (NDIC) has warned bank customers and the public against displaying their bank details saying fraudsters were becoming more creative.

    The NDIC in its official website on Friday gave out four tips for bank customers to safeguard their accounts.

    The Corporation said that customers should ensure that their phones had password and they must not share their bank mobile application password to anyone.

    NDIC also warned bank customers to ensure that their token is secured and that no other parties have access to it.

    The Corporation also urged customers to ensure that their debit card numbers and Card Verification Value (CVV) were not exposed to people.