Amaka Obiefuna

The Nigeria Deposit Insurance Corporation (NDIC) has reassured depositors of commercial banks of full reimbursement in times of financial disruption.

The Managing Director/Chief Executive,  NDIC, Mr. Bello Hassan, gave the assurance on Thursday at the 2024 NDIC Business Editors And Finance Correspondents Association of Nigeria (FICAN) Workshop Holding at the Providence Hotel, Ikeja, Lagos.

The two-day workshop was designed to enrich the understanding of the media and public of the NDIC’s role in maintaining financial stability and protecting depositors funds when banks fail.

He noted that over the years, the NDIC has been instrumental in promoting stability by ensuring that when banks fail, depositors are protected, and their funds are reimbursed promptly.

The NDIC boss used the handling of the Heritage Bank liquidation to illustrate the broader role of the NDIC in ensuring that even in times of financial disruption, depositors can be rest assured that their funds are protected.

The Corporation according to him, in the discharge of its critical role of depositor reimbursement, began the payment of the insured deposits of N5 million

maximum per depositor within a record time of four days of the Heritage bank’s closure, using an innovative model of Bank Verification Numbers (BVN).

He explained: “This was achieved using Bank Verification Numbers (BVN) as a unique identifier to locate depositors’ alternate accounts in other banks

without the need to fill forms or visits to the NDIC offices.

“This innovative approach has indeed, enabled the payment of 84.98 per cent of depositors with BVN linked accounts to date.”

Hassan also assured that depositors with balances exceeding N5 million would also get their full balance while creditors of the bank are equally not left out in the reimbursement exercise.

“Having largely reimbursed depositors their insured deposits, the Corporation is committed to ensuring that depositors with balances exceeding N5 million are also paid the balance of their deposits.

“These uninsured deposits represent a significant portion of the total deposits in Heritage Bank. In this regard, the Corporation is already working assiduously to ensure that, all depositors with amounts in excess of the maximum insured amount of N5 million are paid through liquidation dividends from the realisation of the defunct bank’s assets and recovery of debts,” he said.

He disclosed that the Corporation has already initiated the process of debt recovery and realisation of investments and physical assets of the defunct bank to ensure timely payment of the uninsured deposits of the defunct bank.

“Additionally, the NDIC’s responsibilities extend to the creditors of the defunct bank, who will receive payments after all depositors have been fully reimbursed.

“This orderly process, based on asset realisation and priority of claims, is essential in maintaining public trust in the banking system and promoting financial stability,” Hassan assured.

He appreciated the media for its reportages that have been pivotal in deepening public trust in Nigeria’s banking system.