NDIC to pay Heritage Bank depositors via liquidation

The Nigeria Deposit Insurance Corporation (NDIC) has announced plans to commence payments to depositors of the defunct Heritage Bank with account balances exceeding N5 million.

The payments will be made using liquidation dividends, derived from the bank’s asset realizations and debt recoveries.

Managing Director of NDIC, Bello Hassan, disclosed this during the Editors’ Forum in Lagos. He emphasized the corporation’s commitment to reimbursing depositors whose funds exceed the maximum insured deposit amount of N5 million.

“These uninsured deposits represent a significant portion of the total deposits in Heritage Bank,” Hassan stated. “The Corporation is working tirelessly to recover debts and realize the bank’s assets to ensure these depositors are compensated.”

Efficient Reimbursement of Smaller Depositors

Hassan noted that the NDIC had already reimbursed smaller depositors within a record four days after the bank’s closure, thanks to the use of Bank Verification Numbers (BVN). This innovative approach allowed depositors with BVN-linked accounts in other banks to receive payments without needing to file forms or visit NDIC offices.

This swift action followed NDIC’s recent increase in deposit insurance coverage from N500,000 to N5 million, significantly mitigating the impact of the bank’s failure on affected depositors.

Commitment to International Standards

Hassan highlighted that the NDIC’s efforts align with international best practices under the International Association of Deposit Insurers (IADI) Core Principle 15, which emphasizes timely payments to depositors of failed banks.

The NDIC’s focus now is on the recovery of Heritage Bank’s investments, physical assets, and outstanding debts to ensure the reimbursement of depositors with uninsured funds.