MultiChoice has confirmed it has written off N31.6 billion (approximately $21 million) held in a deposit with Heritage Bank, following the bank’s liquidation in June 2024.
The South African pay-TV operator disclosed this loss in its financial results for the six months ending September 30, 2024.
The initial deposit, which stood at N33.7 billion as of March 31, 2024, had already been reduced to N31.6 billion prior to the bank’s closure, due to cash remittances.
Heritage Bank’s banking licence was revoked by the Central Bank of Nigeria (CBN) on June 3, 2024, and the Nigeria Deposit Insurance Corporation (NDIC) was appointed as the liquidator.
In its statement, MultiChoice explained that the deposit was written off as part of its operating expenses for the period under review. “Following the revocation of Heritage Bank’s banking licence and its subsequent liquidation, the group has written off its receivable relating to the cash held with the bank,” the company noted.
The financial setback is compounded by the continuing depreciation of the naira, which has led to additional foreign exchange losses for the company.
MultiChoice also reported a reduction in funds repatriated from Nigeria, with $65 million extracted in the first half of FY24, down from $91 million in the previous year.
At the end of September 2024, MultiChoice held $11 million in cash in Nigeria, a significant drop from the $39 million reported at the close of FY24.
Not giving in to these challenges, the company has focused on remitting cash from Nigeria, although the process has been hindered by the weaker naira and the substantial write-off related to Heritage Bank.
Although the amount MultiChoice is seeking to recover exceeds the maximum insured deposit of N5 million per depositor, the NDIC has stated it is working to ensure that all depositors, including those with balances above the insured limit, are reimbursed through dividends from the liquidation of the bank’s assets.
These financial challenges have added to MultiChoice’s issues in Nigeria, where it has faced an 18% drop in active DStv subscribers and a decrease in overall revenue.
