The Nigeria Deposit Insurance Corporation (NDIC) has announced that the first tranche of liquidation dividends for uninsured depositors of the defunct Heritage Bank will be paid in April 2025.
This disclosure was made in a press statement released by Hawwau Gambo, the Acting Head of Communication & Public Affairs of the NDIC, on Sunday.
The NDIC stated that the payment would be made on a pro-rata basis to uninsured depositors, in line with Section 72 of the NDIC Act 2023, which prioritizes the settlement of deposit liabilities over other liabilities when an insured institution fails.
The statement read, “With the considerable progress recorded in the asset realization, 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 Corporation emphasized that significant progress has been made in realizing Heritage Bank’s assets and recovering its debts, allowing the planned payout to move forward.
Background on Heritage Bank’s liquidation
Heritage Bank’s banking license was revoked by the Central Bank of Nigeria (CBN) on June 3, 2024. Following this development, the NDIC was appointed as the liquidator in accordance with Section 12(2) of the Banks and Other Financial Institutions Act (BOFIA) 2020 and Section 55(1 & 2) of the NDIC Act 2023. Since the revocation, the NDIC has been responsible for the liquidation process, including the verification and payment of insured deposits to affected depositors.
To date, the NDIC has made significant progress in reimbursing the insured portion of deposits, which is capped at a maximum of N5 million per depositor. However, some depositors have yet to receive their insured amounts due to various reasons.
The NDIC highlighted that these unpaid depositors are primarily those without a Bank Verification Number (BVN) or alternate accounts in other banks, which are essential for retrieving account details from the Nigeria Inter-Bank Settlement System (NIBSS) database.
Other challenges in paying insured depositors include post-no-debit (PND) restrictions on some accounts, Know Your Customer (KYC) limitations—particularly with Tier 1 accounts that restrict the maximum lodgment of funds—and mismatches in account names.
Additionally, some depositors who have already received their payments remain unaware due to the absence of mobile phone transaction alerts linked to their alternate bank accounts. The NDIC has advised such depositors to check their other bank accounts for payments that may have been processed.
Payment to uninsured depositors
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, would be paid as liquidation dividends.
The Corporation has been actively realizing Heritage Bank’s physical assets and recovering its risk assets to generate funds for these payments.
The NDIC’s approach involves simultaneously reimbursing insured depositors while aggressively pursuing the sale of assets and debt recovery. This strategy is aimed at accelerating the liquidation process and ensuring that all depositors are reimbursed without unnecessary delays.
As part of this commitment, the NDIC has advertised the asset disposal process on its official website, social media platforms, major national newspapers, and through radio and television announcements to maintain transparency and compliance with legal requirements.
Legal framework and priority of claims
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. Only after all depositors have been reimbursed will other creditors and shareholders of the failed Heritage Bank be considered for dividend payments.
The NDIC emphasized its commitment to protecting depositors’ funds across all licensed banks and assured the public that the ongoing liquidation process is designed to minimize delays.
The Corporation also urged members of the public to continue their banking activities with confidence, stating that all other licensed banks remain safe and sound.
The NDIC encouraged affected depositors to take proactive steps by verifying their account details and resolving any discrepancies that may hinder payment.
The Corporation reiterated that its priority remains the protection of depositors’ funds and the smooth execution of the liquidation process.
