The Nigeria Deposit Insurance Corporation (NDIC) has announced plans to compensate depositors of Heritage Bank up to N5 million following the revocation of the bank’s operating license by the Central Bank of Nigeria (CBN).
In a statement issued Monday by NDIC spokesperson Bashir Nuhu, the corporation assured depositors that they will receive payments using their Bank Verification Number (BVN) to identify alternate accounts within the banking system. This move aims to ensure a smooth and efficient transfer of funds, thereby protecting depositors and maintaining confidence in the banking sector.
“Our immediate priority is to guarantee that depositors have access to their insured funds with minimal disruption,” the NDIC stated. “Depositors of the bank with alternate accounts within the industry will be paid up to the insured amount of N5 million per depositor using their BVN to locate their alternate account. Depositors with funds exceeding N5 million will receive liquidation dividends upon the realization of the bank’s assets and recovery of debts owed to the bank.”
The NDIC emphasized that depositors’ funds are secure and that the corporation has robust mechanisms to manage the transition.
The NDIC will take over Heritage Bank’s affairs to facilitate an orderly resolution, including verifying and paying insured deposits and managing the bank’s assets and liabilities.
For depositors without accounts at other banks, the NDIC advised visiting the nearest Heritage Bank branch with proof of account ownership, such as a driver’s license, permanent voter’s card, or National Identity Card, along with alternate account details and BVN. Additionally, depositors can file claims online via the NDIC website by downloading and filling out the claims form and uploading the required documents.
Creditors are expected to visit the nearest Heritage Bank branch to file their claims or use the provided online platform. Payments to creditors will commence after all depositors have been compensated. Debtors who have not completed loan repayments are advised to contact the Corporation’s Asset Management Department (AMD).
The CBN revoked Heritage Bank’s license on Monday, appointing the NDIC as the liquidator under Section 12 (2) of the Banks and Other Financial Institutions Act (BOFIA), 2020. The CBN cited the bank’s inability to improve its financial performance, which posed a threat to financial stability, as the reason for the revocation.
“This follows a period during which the CBN engaged with the bank and prescribed various supervisory steps intended to stem the decline. Regrettably, the bank has continued to suffer and has no reasonable prospects of recovery, thereby making the revocation of the license the next necessary step,” the CBN stated.
Earlier reports indicated that Heritage Bank customers had faced difficulties accessing their funds, despite the bank announcing a “system refresh exercise” on May 13. Customers remained stranded at various branches as of Monday.
