THE Nigeria Deposit Insurance Corporation (NDIC) has reassured creditors of the defunct Heritage Bank that they will be reimbursed after all depositors have been fully compensated.

The NDIC’s Managing Director/CEO, Bello Hassan, disclosed this during the 2024 NDIC/Editors Forum held in Lagos, affirming the Corporation’s commitment to orderly asset realisation and prioritisation of claims to uphold public trust in the banking system.

Following the Central Bank of Nigeria’s (CBN) revocation of Heritage Bank’s license on June 3, 2024, the NDIC assumed its role as the bank’s liquidator, tasked with resolving the institution’s affairs and protecting depositors. To this end, the Corporation promptly began reimbursing depositors, disbursing the insured deposit limit of ₦5 million per depositor within four days of the bank’s closure. Utilizing Bank Verification Numbers (BVN) to identify depositors’ alternate accounts in other banks streamlined the process, enabling swift payments without requiring depositors to complete forms or visit NDIC offices.

Bello Hassan highlighted that the NDIC is also working to ensure the payment of uninsured deposits—balances exceeding ₦5 million—through liquidation dividends generated from asset realization and debt recovery. This step aligns with international standards, such as the International Association of Deposit Insurers (IADI) Core Principle 15, which emphasizes timely payouts to depositors of failed banks.

Despite these efforts, Hassan acknowledged challenges, including unresolved cases of depositors unable to access their guaranteed funds. Issues such as inconsistencies in the bank’s depositor database, absence of BVNs, account restrictions, and name mismatches have delayed payments.

The Corporation is diligently addressing these obstacles to ensure that all eligible depositors are promptly reimbursed.

Hassan urged depositors to adhere to Know Your Customer (KYC) requirements prescribed by the CBN, emphasizing that compliance would facilitate smoother transactions and expedite reimbursements in the event of bank closures.

Represented by the Executive Director of Operations Mallam Mustapha Muhammad Ibrahim, Hassan noted that in addition to protecting depositors, the NDIC remains committed to creditors of the defunct bank.

He assured that creditors would receive payments after depositors are fully settled, underscoring the Corporation’s holistic approach to financial stability. He emphasised the NDIC’s broader mandate, which includes deposit insurance, supervision of financial institutions, and resolution of distressed banks to maintain stability in Nigeria’s financial system.

The 2024 NDIC/Editors Forum, themed “Strengthening Nigeria’s Financial Safety-Net: The Role of Deposit Insurance,” highlighted the importance of engaging the media in fostering a deeper understanding of the NDIC’s mandate. Hassan commended the media for their longstanding support and encouraged continued collaboration to enhance public awareness and confidence in the banking system.

The NDIC’s proactive measures following Heritage Bank’s closure exemplify its critical role in safeguarding depositors and promoting financial system stability.

Earlier in his welcome address, the Director, Communication and Public Affairs, NDIC, Bashir A. Nuhu stated that the forum is an avenue to keep media executives abreast with activities of the corporation considering the importance of deposit insurance not only in the banking industry, but the economy in general.

“We have come to find out during the course of the presentations how far NDIC has come and what we intend to do in the future. The second paper is somehow very practical, innovative of what we have done with the most recent closure of some banks in Nigeria,” he stated.

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