NDIC to pay heritage bank depositors up to N5m

Following the revocation of Heritage Bank’s operating licence by the Central Bank of Nigeria (CBN), the Nigeria Deposit Insurance Corporation (NDIC) has outlined the steps it will take to ensure depositors receive their funds.

The corporation assured depositors that they will be paid up to N5 million using their Bank Verification Number (BVN) to identify their alternate accounts within the banking industry.

In a statement signed Monday by Bashir Nuhu, NDIC’s spokesperson, the regulatory body explained that depositors with alternate bank accounts will receive payments up to the insured amount of N5 million.

The BVN system will be used to locate these alternate accounts, ensuring a smooth and efficient transfer of funds in order to protect depositors and maintain confidence in the banking system, it said.

“We are fully prepared to step in and ensure that depositors are protected. Our immediate priority is to guarantee that depositors have access to their insured funds with minimal disruption,” the NDIC said.

“Depositors of the bank that have alternate within the industry will be paid up to the insured amount of N5 million per depositor using their Bank Verification Number (BVN) to locate their alternate account. While depositors with funds in excess of N5 million will be paid liquidation dividend upon realization of the bank’s assets and recovery of debts owed to the bank.”

The NDIC also assured depositors that their funds are secure and that the corporation has robust mechanisms in place to manage the transition.

“We will be taking over the affairs of Heritage Bank to facilitate an orderly resolution. This includes the verification and payment of insured deposits, as well as the management of the bank’s assets and liabilities to maximise recovery and minimize loss to the financial system,” it said.

Verification

The NDIC said anyone with no account at another bank will need to visit the nearest branch of Heritage Bank with proof of account ownership.

Such persons would have to present a verifiable identity card like a driver’s licence, permanent voter’s card, or National Identity Card, along with alternate account details and BVN. This will be used to verify deposit and pay the insured sum, it said.

Alternatively, the NDIC advised affected customers to file a claim online by visiting the NDIC website via, download and fill out the claims form, and upload the required documents.

Creditors are expected to visit the nearest branch of Heritage Bank to file their claims, or use the online platform provided as payment process for creditors will begin after all depositors have been paid.

Meanwhile, debtors that are yet to complete the repayment of loans are advised to contact the Corporation’s Asset Management Department (AMD).

Background

PREMIUM TIMES had earlier reported how customers of Heritage Bank encountered difficulties in several attempts to access their money in their bank accounts.

But the bank said it notified its customers of “system refresh exercise” on 13 May.

However, despite the declaration that the exercise had been concluded by the bank, many customers as of Monday were stranded at the various branches of the bank that were visited by our reporters.

READ ALSO: CBN revokes licence of Heritage Bank

Consequently, the CBN on Monday revoked the licence of the bank and immediately appointed NDIC as the liquidator of the bank in accordance with Section 12 (2) of BOFIA, 2020.

According to a statement issued by the CBN on Monday, the action was in accordance with the apex bank’s mandate to promote a sound financial system in Nigeria and in exercise of its powers under Section 12 of the Banks and Other Financial Act.

“The Board and Management of the bank have not been able to improve the bank’s financial performance, a situation which constitutes a threat to financial stability.

“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 licence the next necessary step,’’ the CBN said.