NDIC pays 700,000 Heritage Bank depositors, begins refunds for 46 failed MFBs

The Nigeria Deposit Insurance Corporation (NDIC) says it has paid the insured deposits of about 700,000 customers of the defunct Heritage Bank, while also commencing reimbursement for depositors of 46 microfinance banks whose licences were revoked.

The disclosure was made by Oludare Sunday, managing director and chief executive officer of the corporation, during a retreat with the House of Representatives Committee on Insurance and Actuarial Matters in Lagos.

Sunday said the NDIC began settling insured depositors immediately after the Central Bank of Nigeria revoked the licences of the affected microfinance banks and appointed the corporation as provisional liquidator.

“We are working on those. The CBN revoked the licences, and we were appointed as the provisional liquidator. We have started paying depositors of those banks, and gradually we intend to cover all the insured depositors,” he said.

He explained that beyond paying insured deposits, the NDIC has commenced recovery of outstanding loans and disposal of assets belonging to the failed institutions to fund payments to uninsured depositors.

“Our function as liquidator involves the payment of guaranteed sums. Thereafter, we go after those who owe the institutions and have not paid. We also ensure that we sell the available assets and realise their investments towards paying the uninsured portion of the deposits. So, we have started paying the guaranteed deposits. What we are doing now is also realising the assets of those institutions,” Sunday stated.

The NDIC boss declined to disclose the exact number of depositors of the failed microfinance banks who have been reimbursed so far, noting that the corporation is working with the Nigerian Interbank Settlement System to identify depositors using their Bank Verification Numbers (BVN).

“So, the more accounts we discover, the more payments we make,” he said.

Providing an update on Heritage Bank, Sunday said about 700,000 depositors have received their insured funds, while efforts are ongoing to trace others whose identities could not be verified due to incomplete or legacy records.

“If you know Heritage Bank, you know it is an amalgamation of several banks, including the acquisition of Enterprise Bank in 2014. So, if you think of banks like Guardian Express and Spring Bank, they are all part of Heritage Bank.

“There are depositors we have not been able to trace, and this is an opportunity for them to come forward. I am sure many of us did the National Youth Service Corps (NYSC) and may have left some money in an account, but there was no BVN then.

“Even the addresses we had were sometimes things like ‘opposite filling station.’ How do you trace such a person? Once they come forward, and for those we have been able to identify from the institution’s database, we have been paying them,” he explained.

Sunday added that the NDIC will continue to recover outstanding loans and dispose of Heritage Bank’s assets to generate funds for liquidation dividends for depositors with balances above the insured limit.

Earlier, he described the NDIC as a critical pillar of Nigeria’s financial safety net, stressing the need for stronger collaboration between regulators and the National Assembly, especially as the banking sector evolves with recapitalisation efforts and financial technology developments.

He noted that while recapitalisation has strengthened financial institutions, it must be supported by sound corporate governance, effective risk management, regulatory compliance, and robust supervision.

According to him, more than 98 per cent of depositors, representing over 281 million accounts across insured institutions, are fully protected under the NDIC deposit insurance scheme.