The Nigeria Deposit Insurance Corporation (NDIC) has commenced the payment of insured deposits to customers of 46 microfinance banks (MFBs) whose operating licences were recently revoked by the Central Bank of Nigeria (CBN). The move is part of the corporation’s statutory responsibility to protect depositors and ensure confidence in Nigeria’s financial system.

According to the NDIC, eligible depositors are receiving their insured deposits through an automated payment process linked to their Bank Verification Numbers (BVNs) and alternative bank accounts. The corporation explained that this approach is intended to speed up reimbursements and reduce the need for customers to visit its offices physically.

The corporation also disclosed that it has intensified efforts to recover outstanding loans and dispose of the assets of the failed institutions. These recoveries are expected to fund additional payments to depositors whose account balances exceeded the maximum insured limit provided under the NDIC Act.

The 46 microfinance banks lost their licences after the CBN determined that they no longer met the regulatory requirements for continued operation. Following the revocation, the NDIC automatically assumed the role of liquidator, taking responsibility for closing the institutions, verifying claims, reimbursing depositors, and managing the liquidation process in accordance with the law.

The NDIC urged affected customers to cooperate during the claims process and ensure that their banking information is accurate to facilitate prompt payment. It also warned members of the public against carrying out transactions with the affected institutions or interfering with their records and assets, noting that such actions could attract legal sanctions.

Financial analysts said the prompt settlement of insured deposits is critical to maintaining confidence in Nigeria’s banking system, particularly within the microfinance sector, which provides financial services to millions of small businesses, traders, and low-income households. They noted that an effective deposit insurance system helps protect savers while reinforcing financial stability.

Stakeholders also believe that the orderly liquidation of failed financial institutions demonstrates the effectiveness of Nigeria’s financial safety framework. They stressed that strong regulatory oversight, prudent risk management, and prompt depositor protection remain essential to safeguarding public trust and ensuring the resilience of the country’s banking sector.

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The Nigerian Deposit Insurance Corporation (NDIC) and Wema Bank have become embroiled in a legal battle over disputed properties in Banana Island, Lagos, with the assets estimated to be worth about N63 billion.

The dispute has led to two separate lawsuits filed at the Federal High Court in Lagos by NDIC, acting in its capacity as liquidator of the defunct Gulf Bank Plc.

The legal action forms part of efforts by the corporation to recover and liquidate assets linked to the failed bank, more than two decades after its collapse.

NDIC Claims Property Worth N63bn

In one of the lawsuits, NDIC alleged that Wema Bank took custody of a 14,000-square-metre property linked to Gulf Bank.

According to the corporation, with land in the area valued at approximately N4.5 million per square metre, the property is estimated to be worth about N63 billion.

The agency stated that the assets were allegedly acquired through Euston Wenberg Engineering Company Limited, described as a shell company associated with Gulf Bank.

NDIC argued that the properties were used to secure an inter-bank deposit valued at N771.78 million. However, investigations reportedly found no evidence of such a deposit in Gulf Bank’s records.

Questions Over Missing Records

The corporation disclosed that a joint examination conducted by the Central Bank of Nigeria and NDIC in September 2005 failed to establish records supporting the existence of the alleged deposit.

According to NDIC, explanations provided by the defunct bank at the time were considered unsatisfactory and lacked documentary evidence.

The corporation further maintained that Gulf Bank acquired six Banana Island plots between 1998 and 2003 through Euston Wenberg Engineering Company Limited and insisted the properties remained beneficially owned by the bank.

Second Lawsuit Challenges Sale of Properties

The second suit concerns another six Banana Island properties allegedly acquired through Bacad Finance and Investment Limited, now known as Supra Commercials Limited.

NDIC stated that Gulf Bank had significant ownership in the company, controlling over 80 percent of its shares.

The corporation alleged that Gulf Bank invested N20 million in the company in 2001 to increase share capital and later injected another N60 million in 2003.

According to NDIC, Wema Bank later sold the disputed properties for N524 million through managers’ cheques issued between 2006 and 2007.

The agency argued that the sale was conducted without any valid mortgage agreement, court order, or proprietary interest.

NDIC Questions Sale Value

NDIC also challenged the reported sale value of the properties, describing the amount as unrealistic.

The corporation argued that each of the disputed Banana Island properties was valued at more than N4 billion at the time, making the N524 million transaction figure questionable.

The case is expected to determine ownership rights and the legitimacy of transactions involving the disputed assets linked to the defunct Gulf Bank.

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The Central Bank of Nigeria (CBN) has dismissed widespread rumours suggesting that Polaris Bank is undergoing liquidation, assuring the public that the country’s banking system remains stable and secure.

In a statement shared via its official X (formerly Twitter) account, the apex bank described the viral claims as false and misleading.

CBN Flags Viral Claim as Fake

The clarification followed the circulation of a report alleging that Polaris Bank had failed to meet recapitalisation requirements and was at risk of losing its operating licence.

The viral post further claimed that the Nigeria Deposit Insurance Corporation (NDIC) was set to take over the bank’s liquidation process.

It also alleged that billionaire industrialist Razaq Okoya had made a move to acquire and revive the bank, pending regulatory approval.

Reacting, the CBN categorically debunked the claims.

“This content is fake. Let the public be guided. The Nigerian Banking System is Safe and Secure,” the bank stated.

Recapitalisation Milestone Strengthens Sector

The apex bank’s reassurance comes shortly after it confirmed that 33 banks met the revised minimum capital requirements under its recapitalisation programme.

According to the CBN, the exercise raised about N4.65 trillion over a 24-month period, strengthening capital adequacy ratios across the banking sector and improving resilience in line with global benchmarks.

However, the bank noted that a small number of institutions are still undergoing regulatory and legal processes within established frameworks.

Background on Polaris Bank

Polaris Bank has faced several regulatory and governance challenges in recent years.

In January 2024, the CBN dissolved the boards and management of Polaris Bank, alongside Union Bank of Nigeria and Keystone Bank, as part of broader reforms to reinforce oversight and stability.

The bank was also involved in controversy in 2022 following disputes over its sale process, with reports indicating that the House of Representatives Nigeria intervened and directed a suspension of the transaction.

Regulatory Developments Continue

More recently, a Federal High Court in Lagos reportedly overturned the removal of the board and management of Union Bank of Nigeria.

In response, the CBN said it would review the judgment while maintaining that the bank’s regulatory status remains unchanged.

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The Central Bank of Nigeria (CBN) and the Nigeria Deposit Insurance Corporation (NDIC) have asked the Federal High Court in Abuja to first determine whether it has the jurisdiction to hear a lawsuit filed by Aso Savings & Loans Plc and Union Homes Savings & Loans Plc over the revocation of their operating licences.

The two regulators raised the objection on Monday during proceedings before Justice Emeka Nwite, arguing that jurisdiction is a threshold issue that must be resolved before any other application can be considered.

The mortgage banks are challenging the recent withdrawal of their licences by the CBN and are seeking court orders to restrain the NDIC from taking further steps, including liquidation, pending the outcome of the case.

CBN’s counsel, Onyeka Ezeah, told the court that the issue of jurisdiction is fundamental and must be addressed first, citing a 2022 Supreme Court ruling which held that courts must resolve jurisdictional questions before entertaining substantive reliefs.

NDIC’s lawyer, Abubakar Shehu, aligned with the CBN’s position, insisting that the corporation acted within its statutory mandate once the licences were revoked. He urged the court to adjourn the matter to allow full arguments on the preliminary objections filed by both defendants.

Counsel to the mortgage institutions, Joseph Silas, argued that the suit was scheduled for the regulators to “show cause” why the court should not restrain them from further action. He warned that continued liquidation steps by the NDIC could cause irreversible damage if the court later finds the licence revocation unlawful.

He maintained that the law grants the affected institutions a 30-day window to challenge the CBN’s decision and urged the court to preserve the status quo to protect both the plaintiffs and their depositors.

Responding, NDIC’s counsel said the agency was acting in the interest of depositors who were unable to access their funds, noting that the law empowers NDIC to step in immediately after licence revocation. He added that shareholders could seek damages if the banks eventually succeed in court.

Justice Nwite, while noting the competing arguments, described jurisdiction as a “threshold issue” and declined to make any interim orders. He adjourned the case until January 21, 2026, for a hearing on the preliminary objections filed by the CBN and NDIC.

The suit, marked FHC/ABJ/CS/2776/2025, was filed by Aso Savings & Loans Plc, Union Homes Savings & Loans Plc, and two individuals against the CBN and NDIC.

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The Nigeria Deposit Insurance Corporation (NDIC) has assured depositors of Aso Savings and Loans Plc and Union Homes Savings and Loans Plc that they will receive insured deposits of up to N2 million per depositor.

The assurance followed the revocation of the operating licences of the two mortgage banks by the Central Bank of Nigeria (CBN).

In a statement issued on Tuesday, the NDIC said it had commenced the liquidation process for the affected institutions in line with the provisions of the NDIC Act 2023.

Earlier, the CBN announced the withdrawal of the licences as part of efforts to reposition the mortgage banking subsector and strengthen regulatory compliance.

According to the apex bank, the action was taken under Section 12 of the Banks and Other Financial Institutions Act (BOFIA) 2020 and Section 7.3 of the Revised Guidelines for Mortgage Banks in Nigeria.

The CBN cited several regulatory breaches by the banks, including failure to meet minimum paid-up share capital requirements, insufficient assets to cover liabilities, critical undercapitalisation, and non-compliance with regulatory directives.

Deposit Payment Process

The NDIC said depositors would be paid insured sums of up to N2 million, using their Bank Verification Number (BVN) to locate alternate bank accounts into which the funds would be credited.

Depositors with balances exceeding N2 million will receive the insured portion immediately, while the remaining balances will be paid later as liquidation dividends after asset sales and loan recoveries.

To facilitate this, the Corporation said it would begin the sale of the banks’ assets and intensify debt recovery efforts.

Claims and Verification

Depositors have been advised to submit claims through the NDIC online claims portal by completing a digital verification form.

Those who prefer physical verification can visit the nearest branches of the closed banks between December 16 and December 30, 2025, where NDIC officials will be available.

Required documents include proof of account ownership, a valid means of identification, BVN details, and information on an alternate bank account.

Creditors, Staff, and Shareholders

Creditors of the failed banks were also advised to submit claims within the verification period. Payment of liquidation dividends to creditors will begin after all depositors have been fully settled.

The NDIC added that staff of the defunct banks would be paid after depositors, while shareholders would receive payments only after further asset realisation and debt recovery.

Debtors of the closed banks were advised to contact the NDIC’s Asset Management Department to settle outstanding loan obligations.

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The Central Bank of Nigeria (CBN) has revoked the operating licences of Aso Savings and Loans Plc and Union Homes Savings and Loans Plc, citing persistent regulatory violations and failure to meet required prudential standards.

In a regulatory notice released on Monday, the apex bank said the decision followed extensive supervisory reviews and enforcement actions aimed at stabilising Nigeria’s financial system.

According to the CBN, both mortgage banks failed to comply with critical provisions of the Banks and Other Financial Institutions Act (BOFIA), including capital adequacy requirements and corporate governance standards.

The apex bank stated that the revocation was necessary to protect depositors, maintain public confidence, and strengthen the integrity of the mortgage banking sub-sector.

“Withdrawing the licences of non-compliant institutions is part of our commitment to ensuring a sound and resilient financial system,” the CBN noted.

Following the revocation, the Nigeria Deposit Insurance Corporation (NDIC) has been appointed as liquidator and will commence the process of reimbursing insured depositors in line with existing regulations.

Industry analysts say the move underscores the CBN’s zero-tolerance stance on regulatory infractions and signals increased scrutiny of financial institutions operating in Nigeria.

The development has sparked concerns among stakeholders in the housing and mortgage sector, particularly as access to long-term housing finance remains a major challenge in the country.

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The Acting Head of Communication & Public Affairs, NDIC, Hawwau Gambo, confirmed this announcement in an official statement released yesterday.

According to the statement, the payment will follow a pro-rata basis, aligning with Section 72 of the NDIC Act 2023.

This section prioritizes settling deposit liabilities before addressing other financial obligations when an insured institution fails in Nigeria.

The NDIC emphasized significant progress in recovering Heritage Bank’s assets and debts, facilitating the planned dividend payout successfully.

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NDIC Managing Director, Bello Hassan, made this appeal in Abuja on Thursday during a Sensitization Seminar for External Solicitors aimed at strengthening cooperation.

Hassan emphasized that external solicitors play a crucial role in debt recovery and asset management, which ensures financial stability within Nigeria’s banking sector.

Following Heritage Bank’s closure, NDIC engaged new external solicitors to navigate legal complexities and facilitate a smooth liquidation process for affected depositors.

“I urge all external solicitors to continue their diligent efforts in assisting NDIC with debt recovery and efficient asset realization,” Hassan stated.

He explained that some solicitors had not participated in previous sensitization programs, making the seminar necessary for reinforcing NDIC’s strategic objectives.

“The recent failure of Heritage Bank highlights the complex nature of bank liquidation and the critical need for external legal collaboration,” he added.

NDIC stressed that legal expertise remains essential in managing bank failures, ensuring depositors’ protection, and maintaining stability in Nigeria’s financial sector.

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The Managing Director of NDIC, Bello Hassan, disclosed this during a press briefing in Abuja. This move follows the Central Bank of Nigeria’s (CBN) decision on Monday to revoke the license of Heritage Bank Plc, aiming to ensure stability in the banking sector. The revocation raised concerns among customers, stakeholders, and the general public.

The CBN’s decision to revoke the license was executed under Section 12 of the Banks and Other Financial Institutions Act (BOFIA) 2020, with the goal of maintaining a sound financial system in Nigeria.

Hassan revealed that, based on a preliminary assessment, the bank holds about N650 billion in depositor funds. He assured customers that recovering the N700 billion in outstanding loans would cover the depositor funds adequately.

“From our preliminary assessment, we have found out that Heritage Bank has N650 billion in deposits and loans amounting to about N700 billion. If we recover this amount, no depositor will lose their deposit,” Hassan stated. “We assure depositors that there is no need to panic and that they will get their money back.”

READ ALSO: NDIC MD Guarantees Heritage Bank Customers Repayment within Seven Days

The NDIC has been appointed as the liquidator of Heritage Bank. Customers with insured deposits will be paid up to the insured limit of N5 million. Concerns had arisen that customers with amounts exceeding the insured limit might be at risk, but Hassan reassured depositors of their safety.

“There is no need for panic. There are 2.3 million depositors of Heritage Bank, and about 99.9 percent of that figure have less than N5 million as deposits,” he said. “Only about 4,000 depositors have deposits of N5 million and above.”

READ ALSO: CBN Explains Reasons Behind Revocation of Heritage Bank’s License

Hassan’s statements aim to calm fears and ensure depositors of Heritage Bank that their funds are secure, with the NDIC committed to recovering the owed loans and safeguarding depositor interests.

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This update was shared by Dr. Bello Hassan, the Managing Director of the NDIC, during the NDIC Special Day at the ongoing 45th Kaduna International Trade Fair.

Dr. Hassan, represented by the NDIC’s Deputy Director of Communication, Hauwa Gambo, reiterated the corporation’s commitment to safeguarding the funds of Nigerian depositors, particularly in distressed licensed banks.

He emphasized the implementation of the Single Customer View framework to expedite payments to depositors of closed banks, ensuring timely reimbursements.

Furthermore, Dr. Hassan highlighted the NDIC’s collaboration with the judiciary for the swift prosecution of failed insured banks, resulting in the resolution of long-standing cases such as the liquidation of Fortune and Triumph Banks.

READ ALSO: Top CEOs/MDs of Mortgage banks in Nigeria by market cap

He noted the significant improvement in debt recovery rates, leading to the declaration of 100% liquidation dividends to uninsured depositors of over 20 banks in liquidation.

The NDIC boss also outlined the corporation’s efforts in deploying digital remote payment strategies to facilitate electronic fund transfers to verified depositors’ alternate bank accounts. Additionally, initiatives like the ‘Deposit Tracer,’ launched in partnership with Mobile Operators, aim to address apathy among depositors with small balances, allowing them to access their funds through mobile accounts.

Dr. Hassan encouraged depositors of banks in liquidation to take advantage of these initiatives to claim their funds while assuring them of the NDIC’s unwavering commitment to protecting Nigerian depositors’ interests.

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