The Nigerian Deposit Insurance Corporation (NDIC) will begin repaying depositors of Heritage Bank by the end of the week. This announcement was made by NDIC Managing Director, Bello Hassan, during a briefing on the bank’s liquidation in Abuja on Wednesday. See process for repayment to customers👇https://www.channelstv.com/2024/06/03/step-by-step-process-how-heritage-bank-customers-will-get-n5m-insured-funds-ndic/
Heritage Bank’s liquidation follows the Central Bank of Nigeria (CBN) revoking its banking license on Monday. The bank has total deposits of N650 billion and a loan portfolio exceeding N700 billion. Hassan stated that the NDIC aims to recover the loans within the next six months.
All depositors are currently being verified. Insured deposits up to N5 million will be paid out immediately, while those with deposits above N5 million will receive payment after the bank’s assets are sold. Heritage Bank has 2.3 million depositors, with 99% holding balances under N5 million. The bank operates 116 branches nationwide.
The NDIC’s assurance will bring relief to Heritage Bank customers who were worried after the bank’s license was revoked. The CBN revoked the license to ensure a sound financial system in Nigeria, citing the bank’s breach of Section 12 (1) of the Banks and Other Financial Institutions Act (BOFIA) 2020. The bank’s board and management failed to improve its financial performance, posing a threat to financial stability.
The CBN had engaged with Heritage Bank and recommended supervisory steps to halt its decline, but the bank continued to struggle with no prospects of recovery. Consequently, the CBN revoked the license to maintain public confidence in the banking system and appointed the NDIC as the liquidator under Section 12 (2) of BOFIA 2020.
