The Nigerian Deposit Insurance Commission (NDIC) has initiated the liquidation process for the failed Heritage Bank, beginning with the verification and payment of depositors. This follows the Central Bank of Nigeria's (CBN) decision to revoke Heritage Bank's license due to financial instability.
In a statement signed by the Acting Director of Corporate Communication, Sidi Ali, the CBN explained that the bank's persistent breach of Section 12 (1) of the Banks and Other Financial Institutions Act (BOFIA), 2020, necessitated the revocation. Despite various supervisory measures, Heritage Bank's financial performance continued to decline, posing a threat to financial stability.
NDIC, now acting as the liquidator, confirmed that depositors would receive up to N5 million using their Bank Verification Number (BVN) to locate alternate accounts. Those with funds exceeding N5 million will be paid liquidation dividends once the bank's assets are realized and debts recovered. The NDIC also advised depositors without alternate accounts to visit the nearest branch with proof of account ownership and identification for verification and payment.
The Commission assured the public of its commitment to safeguarding depositors' funds in all licensed banks, urging them to continue banking without fear. The Bank Customers Association of Nigeria (BCAN) supported the CBN's decision, highlighting the necessity to protect the broader financial system. BCAN President, Dr. Uju Ogubunka, emphasized that the CBN's move, though inconvenient for some customers, was essential to prevent systemic risks.
Professor of Capital Market, Uche Uwaleke, and the House of Representatives echoed similar sentiments, noting the importance of protecting depositors and maintaining financial stability. The House pledged to oversee the liquidation process to ensure transparency and the protection of depositors' rights.
The NDIC's swift action and the CBN's regulatory measures aim to maintain confidence in the banking sector, ensuring that the interests of depositors and the financial system's integrity are preserved.
