NDIC gives update on payment of uninsured sums to depositors of liquidated Heritage Bank

In response to concerns raised by depositors of the defunct Heritage Bank whose balances exceed the maximum deposit insurance limit of N5 million, the Nigeria Deposit Insurance Corporation (NDIC) wishes to clarify that the Corporation has intensified efforts to ensure timely payments.

According to NDIC Ag. Head, Communication & Public Affairs, Hawwau Gambo in a press statement on Sunday, following the revocation of Heritage Bank’s banking license by the Central Bank of Nigeria (CBN) on June 3, 2024, the NDIC was appointed as the liquidator in accordance with Section 12(2) of the Banks and Other Financial Institutions Act (BOFIA) 2020 and Section 55(1 & 2) of the NDIC Act 2023.

In line with its statutory mandate, the Corporation immediately commenced the bank’s liquidation process, including the verification and payment of insured deposits to all depositors. Significant progress has been made in reimbursing the insured deposits of the N5 million maximum per depositor. It is instructive to state that, depositors yet to be paid their insured deposits are largely those without Bank Verification Number (BVN) or alternate accounts in other banks to enable the Corporation fetch the accounts from the Nigeria Inter-Bank Settlement System (NIBSS) database to effect payment.

Other depositors in this category are those with post no debit (PND) restrictions on their accounts. Additionally, some accounts have Know Your Customer (KYC) limitations such as Tier 1 accounts that places restrictions on the maximum lodgment of funds, while others have name mismatches that require resolution. Some depositors who have been paid may also be unaware that they have received payments due to lack of mobile phone transaction alerts on their alternate accounts into which the insured sums were paid by the NDIC. Therefore, depositors are advised to check their alternate bank accounts, as some payments may have been processed without their immediate awareness.

Commencement of Payment to Uninsured Depositors
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. The NDIC has 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 realization 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.

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.

The NDIC wishes to reiterate its commitment to the safety of depositors’ funds in all licensed banks. Members of the public are enjoined to continue their banking activities without fear, as all other banks remain safe and sound.

For further enquiries, please email us at claimscomplaints@ndic.gov.ng or call the Claims Resolution Department on weekdays on the following numbers from 9:00 a.m. to 5:00 p.m.: 810 422 0807; ‎0810 931 3326; ‎0903 819 7064; ‎0906 465 7140; ‎0903 727 3810.