NDIC To Declare First Tranche Of Heritage Bank Liquidation Dividends In April

The disclosure was made in a press statement released by the Acting Head of Communication & Public Affairs, NDIC, Hawwau Gambo, on Sunday.

According to the statement, the declaration of the first tranche of liquidation dividends in April will be followed by the payment to uninsured depositors.

The NDIC stated that the payment will be made on a pro-rata basis, in line with Section 72 of the NDIC Act 2023, which prioritises the settlement of deposit liabilities over other liabilities when an insured institution fails.

The statement read, “With the considerable progress recorded in the asset realisation, the Corporation will declare the first tranche of liquidation dividends in April 2025, which will be paid to uninsured depositors on a pro-rata basis, in line with Section 72 of the NDIC Act 2023 on the priority of claims.”

The NDIC said significant progress has been made in realising Heritage Bank’s assets and recovering its debts, allowing the planned declaration and subsequent payout to move forward.

Heritage Bank’s banking licence was revoked by the Central Bank of Nigeria on June 3, 2024. Following this, the NDIC was appointed as the liquidator in accordance with Section 12(2) of the Banks and Other Financial Institutions Act 2020 and Section 55(1 & 2) of the NDIC Act 2023.

Since the revocation, the NDIC has taken charge of the liquidation process, which includes verifying and paying insured deposits to affected depositors.

The NDIC noted that it has made significant progress in reimbursing insured deposits, which are capped at a maximum of N5 m per depositor. However, it said some depositors have not received their insured amounts due to various reasons.

The Corporation identified some of the challenges as the absence of Bank Verification Numbers or alternate accounts in other banks, which are essential for retrieving account details from the Nigeria Inter-Bank Settlement System database.

Other challenges include post-no-debit restrictions on some accounts, Know Your Customer limitations, particularly on Tier 1 accounts that restrict the maximum lodgement of funds, and mismatches in account names, according to the statement.

The NDIC said some depositors who have received their payments may not be aware because of the absence of mobile phone transaction alerts linked to their alternate bank accounts. It advised such depositors to check their other bank accounts for payments that may have been processed.

While depositors with balances exceeding N5 million have already received the insured portion, the NDIC noted that the remaining balance, which exceeds the insurance limit, will be paid as liquidation dividends. It said it had been actively realising Heritage Bank’s physical assets and recovering its risk assets to generate funds for these payments.

The NDIC said its approach involves simultaneously reimbursing insured depositors while pursuing the sale of assets and debt recovery aggressively.

It explained that this strategy is aimed at speeding up the liquidation process and ensuring that all depositors are reimbursed without unnecessary delays.

The Corporation said it had advertised the asset disposal process on its official website, social media platforms, major national newspapers, and through radio and television announcements to ensure transparency.

The NDIC reiterated that the distribution of liquidation dividends would strictly adhere to Section 72 of the NDIC Act 2023, which stipulates that in the event of an insured institution’s inability to meet its obligations, the assets of the institution must first be used to satisfy deposit liabilities.

The Corporation said only after all depositors have been reimbursed will other creditors and shareholders of the failed Heritage Bank be considered for dividend payments.

The Corporation said it remains committed to protecting depositors’ funds across all licensed banks and assured the public that the ongoing liquidation process is being carried out to minimise delays.

It urged the public to continue their banking activities with confidence, noting that all other licensed banks remain safe and sound.