NDIC begins debt recovery to pay uninsured depositors of Heritage Bank

The Nigeria Deposit Insurance Corporation (NDIC) on Tuesday said it has initiated the process of debt recovery and realisation of investments and physical assets of the defunct Heritage Bank to ensure timely reimbursement of uninsured deposits, after paying 86 percent of insured deposits.

Bello Hassan, managing director/CEO, NDIC, disclosed this in Lagos, at a retreat for members of the House of Reps committee on insurance and actuarial matters of the Federal House of Representatives, themed, “Strengthening financial stability and deposit insurance frameworks for economic resilience”.

Represented by Emily Osuji, NDIC’s executive director, corporate services, he said, that upon payoff of both insured and uninsured deposits, the corporation would proceed with the payment of creditors and others by the priority of claim as provided in the extant law.

According to him, cumulatively, as of August 20, 2024, the NDIC has paid 86 percent of the total insured deposits. The corporation is making efforts to complete the payments of the remaining 14 percent of the insured deposits.

He said some of the insured depositors constituting these remaining 14 percent were customers whose accounts have post no debit (PND) instructions by courts or regulatory authorities.

Read also: Lack of BVN stalls 18% Heritage Bank depositors from reimbursement NDIC

Others are those with Know Your Customer (KYC) limitations on the maximum lodgement per day, customers with no Bank Verification Number (BVN) attached to their accounts or have not come forward for verification to provide alternate accounts in other banks to enable the corporation to pay them.

“Notwithstanding the success recorded in payment of insured sums to depositors of the defunct heritage bank, the corporation is mindful of the uninsured depositors and we have therefore initiated the process of debt recovery and realisation of investments and physical assets of the bank to ensure timely reimbursement of uninsured deposits,” Hassan said.

The NDIC chief said the corporation recognises the importance of timely reimbursement to depositors in maintaining financial stability. In this regard, the corporation had reassessed its depositor payment methodology to adopt a different approach that will ensure prompt payment to depositors. This was tested in the recent payment to depositors of Heritage Bank in-liquidation.

Recall that the NCC using the BVN of depositors obtained from the Nigeria Inter Bank Settlement System (NIBSS) was able to access alternate accounts of customers and commenced payment to depositors within a record time of four days.