The House of Representatives has asked the Central Bank of Nigeria to investigate the leadership and management of the failed Heritage Bank “to identify possible mismanagement or wrongdoing that may have contributed to the bank’s failure.”
The Body has also directed its Committee on Banking Regulations to probe the circumstances surrounding the failure of Heritage bank.
The resolutions followed a motion of urgent public importance moved by Uchenna Okonkwo (LP, Anambra) on Tuesday during plenary.
Recall that the Central Bank Of Nigeria (CBN), on June 3rd revoked the license of the bank, citing its violation of Section 12 (1) of the Banks and Other Financial Institutions Act (BOFIA), 2020.
Consequently, the CBN appointed Nigeria Deposit Insurance Corporation (NDIC) as the liquidator, pursuant to Section 12(2) of BOFIA, 2020.
Subscribe to our Telegram channel for the latest updates.
Follow the latest developments with instant alerts on breaking news, top stories, and trending headlines.
The NDIC announced that depositors of the bank who have alternate accounts within the industry will be paid up to the insured amount of N5 million per depositor using their Bank Verification Number (BVN) to locate their alternate account.
According to NDIC, depositors with funds in excess of N5 million are to be paid liquidation dividends upon realization of the bank’s assets and recovery of debts owed to the bank.
In the motion, Okonkwo said the liquidation process could disproportionately affect some depositors who have above the N5 million threshold.
He noted that “limiting compensation to N5 million is deeply inadequate to alleviate the substantial losses experienced by depositors who had placed their trust in Heritage Bank, exacerbating their financial distress and uncertainty.”
The lawmaker said the CBN failed to disclose the status of the bank to the public, in order for depositors to take adequate action.
“This lack of transparency has not only eroded public trust in the banking system and regulatory bodies but has also intensified the distress and uncertainty faced by depositors who relied on the bank for their financial security,” Okonkwo said.
