THE Nigeria Deposit Insurance Corporation (NDIC) said it has started paying N46.6 billion in liquidation dividends to depositors of the defunct Heritage Bank.

The corporation disclosed this in a statement on Sunday, April 27, by its Acting Head of Communication and Public Affairs, Hawwau Gambo.

It said the funds were realised from sales of the bank’s assets and recovery of debts owed.

A liquidation dividend is paid to depositors of a closed bank, beyond the maximum insured limit, using proceeds from asset sales and debt recovery.

According to Gambo, the liquidation dividends may also cover payments to creditors and shareholders once all depositors have been fully reimbursed.

She explained that the NDIC began payment of the first tranche of the liquidation dividends on April 25 and that the initial dividend is paid at 9.2 kobo per naira on a pro-rata basis to depositors with balances above N5 million.

She said further that additional payments would be made as more assets of the defunct bank are realised and outstanding debts recovered.

The ICIR reported that the Central Bank of Nigeria (CBN), on June 3, 2024, revoked the operating licence of Heritage Bank.

It said its action became necessary due to the Heritage Bank’s breach of Section 12 (1) of the Banks and Other Financial Institutions Act (BOFIA) 2020.

It hinted specifically that the bank’s board and management failed to improve the bank’s financial performance, a situation which CBN revealed constituted a threat to financial stability.

Following the revocation, the NDIC immediately reimbursed insured deposits up to N5 million.

It used depositors’ Bank Verification Numbers (BVN) to locate alternate accounts and automatically credit the insured amounts.

The corporation also used existing records from insured payments to disburse the first tranche of liquidation dividends.

“Depositors with balances exceeding N5 million who did not receive their liquidation dividends should visit the nearest NDIC office.

“Depositors without alternative bank accounts, who were not paid the insured amount, should also visit NDIC offices or download forms from www.ndic.gov.ng,” Gambo stated.

She noted that depositors must complete and submit a deposit verification form to receive their insured amounts and, where applicable, the first tranche of dividends.