Hassan: NDIC has Paid 86% of Heritage, Other Insured Depositors of Failed Banks

Nume Ekeghe

Managing Director/CEO of the Nigeria Deposit Insurance Corporation (NDIC), Mr. Bello Hassan, has announced that the commission has disbursed 86 percent of the total insured deposits to customers of failed banks, including Heritage Bank.

This represents an increase from the 82.36 per cent reported just a week ago.

Hassan, explained that the payment delays were primarily due to accounts that have Post No Debit (PND) instructions imposed by courts or regulatory authorities. Other factors include customers with Know Your Customer (KYC) limitations on daily deposits, accounts without a Bank Verification Number (BVN), and those who have not yet come forward for verification or provided alternative bank accounts to facilitate payment.

He said this yesterday in Lagos, during a retreat organised by the NDIC for the House Committee on Insurance and Actuarial Matters of the Federal House of Representatives.

The event with the theme, “Strengthening Financial Stability and Deposit Insurance Frameworks for Economic Resilience,” also renewed the representatives’ commitment to prioritising the enhancement of regulatory frameworks.

They emphasised the need for collaboration between governmental bodies, financial institutions, and stakeholders to ensure that regulations are not only comprehensive but also adaptable to evolving economic conditions.

Hassan said: “As at today, the NDIC has paid 86 per cent of the total insured deposits. The Corporation is making efforts to complete the payments of the remaining 14 per cent of the insured deposits.

“Some of the insured depositors constituting these remaining 14 per cent are customers whose accounts have post no debit (PND) instructions by courts or regulatory authorities.

“Others are those with KYC limitations on the maximum lodgment per day, customers with no BVN attached to their accounts or have not come forward for verification to provide alternate accounts in other banks to enable the Corporation to pay them.

“Notwithstanding the success recorded in payment of insured sums to depositors of the defunct heritage bank, the Corporation is mindful of the uninsured depositors and we have therefore initiated the process of debt recovery and realisation of investments and physical assets of the bank to ensure timely reimbursement of uninsured deposits.

“It’s pertinent to remind us here that upon payoff of both insured and uninsured deposits, the Corporation will subsequently proceed with the payment of creditors and others in accordance with priority of claim as provided in the extant law.”

Chairman of the House Committee on Insurance and Actuarial Matters, Hon. Ahmadu Usman Jaha, emphasised the critical need for robust financial stability measures, citing global economic shifts and unforeseen crises.

“In recent years, we witnessed various challenges that threatened the resilience of our financial systems-global economic shifts, regulatory challenges, and the impacts of unforeseen crises. These challenges underscore the critical need for robust deposit insurance frameworks that protect depositors and foster confidence in our banking systems.”

Jaha, pledged to throw weight behind NDIC by reviewing and updating policies to address emerging risks and adapting to the evolving landscape of the financial sector.

He added: “NDIC plays a pivotal role in safeguarding deposits, ensuring that our financial institutions operate within a secure environment. We shall continue to enhance the effectiveness of the NDIC in fulfilling its mandate.

“A resilient economy can withstand shocks and continue to thrive. As we work to fortify our deposit insurance schemes, we must also address broader economic factors that contribute to resilience.

“This includes promoting financial literacy among the populace, encouraging savings, and ensuring that our citizens understand the importance of deposit insurance. More so, we must leverage technology to improve our systems, making them more resilient against potential disruptions if we must strengthen our financial stability” he said.