Heritage Bank: Peter Obi demands payment of depositors’ funds immediately

Peter Obi, the Labour Party’s presidential candidate from the last election, has urged the federal government and the Nigeria Deposit Insurance Corporation (NDIC) to immediately fully reimburse depositors of Heritage Bank following the recent revocation of its license by the Central Bank.

In a series of X posts on Monday, Obi said the closure of the bank will have “a far-reaching impact” on the economy.

He said many depositors, already perplexed by the economic condition of the country, depend on their savings in the bank to survive.

According to him, anything short of full and immediate repayment of these funds will only worsen the economic situation of the depositors.

“The latest CBN’s revocation order on Heritage Bank’s operating license and subsequent appointment of NDIC as liquidator of its assets, though affirmed by the regulators as necessary at this point to enhance financial stability, has a  far-reaching impact on the bank’s depositors.

“Given the harsh economic realities in the country now, I will urge the federal government via NDIC to ensure immediate payment of all depositors in Heritage Bank in full to help alleviate the prevailing hardship the people are going through in the country.

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“Many individual savers and SMEs are already groaning under severe negative effects of the economy and already living in abject poverty. These depositors depend on the savings they have in the now-liquidated bank to survive.

“Any attempt to deny or delay payment to these depositors would worsen their economic woes and could lead to a crisis of confidence in the banking system.

“Anything short of immediate and full payment can create panic in the banking sector which our already fragile economy cannot afford,” Obi said.

The Central Bank of Nigeria (CBN) revoked the banking licence of Heritage Bank Plc with immediate effect, citing the bank’s persistent financial instability and breach of regulatory requirements.

The decision was part of the CBN’s mandate to maintain a sound financial system in Nigeria, as outlined under Section 12 of the Banks and Other Financial Institutions Act (BOFIA) 2020.

In a press release on Monday, the CBN disclosed that Heritage Bank had failed to adhere to Section 12 (1) of BOFIA 2020, which necessitated regulatory intervention.

Despite multiple supervisory measures prescribed by the CBN to mitigate the bank’s declining financial performance, Heritage Bank has been unable to improve its financial health.

The bank’s continuous underperformance poses a significant threat to financial stability, compelling the CBN to revoke its licence.