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NDIC pays 29,573 depositors of microfinance banks, PMBs

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2 years ago

The Managing Director of the Nigeria Deposit Insurance Corporation (NDIC), Mr Bello Hassan, said it has paid about N1.084 billion to 29,573 depositors of recently-closed microfinance banks and Primary Mortgage Banks.

Hassan disclosed this in his speech at the 18th Abuja International Trade Fair last week.

While noting that payment was still ongoing, he said depositors with funds exceeding the insured limit would get the liquidation dividends after recovery of debts and sale of physical assets of the closed banks.

Hassan said, “Recently, following the revocation of licences for 179 microfinance banks and four Primary Mortgage Banks by the Central Bank of Nigeria, the NDIC immediately commenced liquidation of the banks and began disbursing insured sums to depositors within just seven days of the closure of these banks.

“It is important to note that as of September 22, the corporation had paid a cumulative insured sum of N1.084 billion to 29,573 depositors of the closed MFBs/PMBs.

“It is, however, instructive to let you know that payments are still ongoing and depositors with funds exceeding the insured limit will receive liquidation dividends after recovery of debts and sale of physical assets of the closed banks.”

Nigerian depositors, he said, are the commission’s priority.

Hassan added, “Currently, the corporation is in the process of verifying and paying liquidation dividends to depositors and stakeholders of 20 closed banks. They are Allied Bank, Peak Merchant Bank, Commerce Bank, Continental Merchant Bank, Financial Merchant Bank, Fortune Bank, Gulf Bank, Hallmark Bank, Icon Merchant Bank, Liberty Bank, Nigeria Merchant Bank, North South Bank, Premier Commercial Bank, Prime Merchant Bank, Progress Bank and Merchant Bank.”

He advised depositors against illegal fund managers, often referred to as “wonder banks” or “ponzi schemes,” offering high interest rates and profits that are too good to be true and may lead to devastating losses for many.

He said the illegal fund managers are neither licenced by the Central Bank of Nigeria (CBN) nor covered by the NDIC deposit insurance scheme.

The NDIC had earlier said that the deposits of directors and staff of defunct banks are excluded from its deposit insurance scheme.

Represented by NDIC Director, Communication and Public Affairs, Mr Bashir Nuhu, Hassan advised the public to “patronise only banking institutions with a display of the NDIC stickers carrying the words, ‘’nsured by NDIC’ in their banking halls or entrances and various branches across the country.

“Furthermore, the corporation’s activities through the supervision of banks, continuous monitoring and oversight serve as consumer protection for depositors which enhances confidence in the financial system.”

He also restated the corporation’s contributions towards ensuring the stability of the financial system by effectively complimenting the CBN in supervising the banking sector and safeguarding depositors’ funds from the adverse effects of bank failures when they occur.

This, he said, acts as an incentive for the unbanked to access the financial services of licensed banks.

He further reiterated the NDIC’s key mandate to provide deposit guarantees to depositors of insured financial institutions, bank supervision, distress resolution and bank liquidation.

He said over the years, the corporation had grown stronger in fulfilling these responsibilities and has significantly enhanced its public policy objectives of establishing a robust deposit insurance scheme in the country.

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