₦airaland Forum

The Nigeria Deposit Insurance Corporation says it has disbursed the insured deposits of N5 million each to 82.36 per cent of the total customers of the defunct Heritage Bank.

It also noted that 17.64 per cent of the insured deposits still pending payment mainly belong to depositors with accounts that have Post-No Debits instructions or lack a Bank Verification Number.

This was disclosed in a statement signed by the Director, Communication and Public Affairs, Bashir Nuhu, on Sunday in Abuja.

On June 3, 2024, the Central Bank of Nigeria revoked the banking license of Heritage Bank Plc due to persistent financial instability and regulatory breaches.

The decision, according to the apex bank, is in line with the CBN’s mandate under Section 12 of the Banks and Other Financial Institutions Act 2020, which aims to maintain a stable financial system in Nigeria.

Following the withdrawal of Heritage Bank’s licence, the NDIC stated that it would begin payment of the 2.3 million depositors of the bank.

Giving an update in the statement issued on Sunday, the director disclosed that disbursement to affected customers started four days after the liquidation.

He added that this feat was achieved using Bank Verification Numbers as a unique identifier to locate depositors’ alternate accounts in other banks.

The statement read in part, “In the discharge of its deposit guarantee mandate, the Corporation began the payment of the insured deposits of N5m maximum per depositor within a record time of four days of the bank closure.

“This was achieved using Bank Verification Numbers as a unique identifier to locate depositors’ alternate accounts in other banks.

“This unprecedented achievement of direct payment through BVN-linked alternate accounts without the need for depositors to visit NDIC offices or fill out forms marks a historic shift for the NDIC in the prompt reimbursement of depositors with payment of about 82.36 per cent of the total insured deposit to date.”

For depositors with more than N5m, the director explained that the remaining balances (classified as uninsured deposits) would be paid as liquidation dividends upon realization of the defunct bank’s assets and recovery of debts owed to the defunct bank.

“It is instructive to state that, the remaining 17.64 per cent of the insured deposits yet to be paid were largely depositors whose accounts have post no debits instructions or have no BVN. Others are those with no alternative accounts in other banks or accounts with a KYC limit on the maximum lodgment per day and are yet to come forward for verification.

“However, depositors with balances exceeding Five Million Naira have been paid the initial insured sum of Five Million Naira, while the remaining balances (classified as uninsured deposits) will be paid as liquidation dividends upon realization of the defunct bank’s assets and recovery of debts owed to the defunct bank,” the statement added.

Mrexcell:
So what the ndic is saying here is that only #5m of customers money in nigerian banks is actually insured with the cbn anything above #5m might enter voice mail if ur bank is liquidated? This policy won't encourage nigerians to leave huge amounts in their local bank accounts.

RenaissanceGuy:
CEOs and executives of failed banks no longer go to jail like we saw during Sanusi era??

Mrexcell:
So what the ndic is saying here is that only #5m of customers money in nigerian banks is actually insured with the cbn anything above #5m might enter voice mail if ur bank is liquidated? This policy won't encourage nigerians to leave huge amounts in their local bank accounts.

OlujobaSamuel:
It is the law, it was even just reviewed, talk to your lawmakers if you want it to go higher.
Btw, irrespective of what the law says, no deposit insurance agency of any country will insure all deposits irrespective of amount, there is always a limit to insured funds

SpaceX:
so if you have above 5m the money don disappear be that. Then what is the essence of the bank?

DeltaBachelor:
Cool....This is good, although it is a case of equality and not equity because I sure say some customers nor get reach 20,000 for their account before , while some get over 50 million. Anyways, what do I know ?

Mrexcell:
So what the ndic is saying here is that only #5m of customers money in nigerian banks is actually insured with the cbn anything above #5m might enter voice mail if ur bank is liquidated? This policy won't encourage nigerians to leave huge amounts in their local bank accounts.

yad2eidi:
this will make it very easy for govt to run a scam on its citizens. especially my naja govt

RepoMan007:
what of those with below N5m?

ecolime:
It's the law which is why it's good not to have all your funds in one bank. Spread your risks.

Also, it's safer to bank with the big banks. Go through the quarterly financials and follow their news bumper to bumper incase you need to move you money ASAP

The unsecured deposits can still be paid much later if NDIC is able to recover the debts owed to the institution but you can't bank on this at all.