NDIC Begins Verification of Insured Depositors of Defunct Peak Merchant Bank

James Emejo in Abuja

The Nigeria Deposit Insurance corporation (NDIC), has said verification of insured depositors of Peak Merchant Bank in-liquidation had commenced towards payment of their insured sums.

Director, Communication and Public Affairs, NDIC, Mr. Bashir Nuhu, in a statement said the move was in line with the corporation’s mandate of deposit guaranty and reimbursement of depositors in the event of bank failure.

He noted that the verification exercise would enable depositors of the defunct bank to cross-check and ascertain their account information as well as balances with the bank as at closure.

Nuhu also explained that the process is a prelude to the payment of insured sums to such depositors.

He said, “Depositors are therefore enjoined to visit the bank’s old premises or the corporation’s office nearest to them with proof of account ownership and verifiable means of identification for the exercise.”

The NDIC added that insured sum is the first and mandatory payment that depositors are paid, up to specified limit, if a bank fails.

Depositors are paid amounts in excess of the insured sums subsequently, as liquidation dividends from proceeds of the closed bank’s assets as realised by NDIC as liquidator. 

The central bank in March 2003, announced the revocation of the operating license of Peak Merchant Bank Limited following alleged overbearing influence of the chairman who was also a major shareholder in the bank.

The liquidated institution reportedly suffered from persistent illiquidity, poor asset quality, significant insider abuses and poor track record of profitability.

However, the process of liquidation had been delayed by litigation from aggrieved shareholders.