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Payment of liquidation dividends to depositors of failed banks ongoing

The Nigeria Deposit Insurance Corporation (NDIC) is currently settling the liquidation dividends of depositors of banks whose licenses were revoked by the Central Bank of Nigeria (CBN).

The managing director of the corporation, Bello Hassan, said this in an interview on the sidelines of the 2021 Financial Correspondents Association of Nigeria (FICAN) workshop on Friday in Ibadan.

”One of our mandates is also to liquidate license deposit institutions whose deposit has been revoked by the CBN.

“So you have various categories that are currently in liquidation, the Deposit Money Banks (DMBs), Micro Finance Banks (MFBs) and Primary Mortgage Banks (PMBs).

“As liquidators, what we do immediately there is revocation of license is to pay the maximum insured amount.

Read also: CBN says banks remain stable, resilient despite pandemic

“After that, we proceeded to recover the loans and advances that were granted by those institutions before revocation and also realise the assets that are left behind so that we can pay it to the depositors.

“ We only pay maximum insured amount at the point of liquidation then, subsequently, begin to pay depositors and after that, we wind up but the payment is currently ongoing,’’ he said.

In a lecture, Galadima Gana, the director of, Insurance and Surveillance Department of the NDIC, said the Corporation had successfully closed 325 MFBs, 50 PMBs, and 49 DMBs whose licenses were revoked by the CBN with minimal diverse effect on the stability and confidence in the banking sector.

He said that NDIC had cumulatively paid N8.27billion to insured depositors of DMBs, N3.38billion to insured depositors of MFBs, and N11billion to insured depositors of PMBs.

Gana represents 60.71 percent, 46.94 percent, and 18.10 percent of the insured amounts, respectively.

He said that the payment to uninsured depositors, creditors, and shareholders of DMBs cumulatively stood at N100.85bn, N1.27billion, and N4.83billion, respectively.

This, he said, represents 51.07 percent, 73.13 percent, and 92.81 percent of the respective amounts.

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