NDIC yet to conclude Fortis Bank liquidation

The Nigeria Deposit Insurance Corporation (NDIC) yesterday said it was yet to conclude the liquidation of Fortis Microfinance Bank (FMB).

It assured worried depositors of payment of funds in excess of the insured limits.

It said the bank collapsed as a result of mismanagement and abysmal corporate governance practices

It said N2billion was released by the Central bank of Nigeria (CBN) to pay depositors of the troubled FMB.

It said the payment was meant to ease the hardship of the depositors before the bank’s licence was revoked.

The corporation made the clarifications in a statement by its Director for Communication and Public Affairs, Dr. Sunday Oluyemi, against the anxiety of some depositors.

A businesswoman, Mrs. Uju Ohanenye, had raised fears over her N222.4million fixed deposit in the defunct bank.

She pleaded for intervention by  NDIC to save all innocent  depositors.

In its statement, the deposit insurance corporation said it is ready to pay depositors with funds in excess of the insured limits.

The statement said: “Contrary to misleading reports, the Nigeria Deposit Insurance Corporation (NDIC) has adhered to statutory guidelines on the distress resolution and liquidation of Fortis Microfinance Bank (MFB) Plc. and the protection of interest of depositors.

“Initial efforts by regulatory authorities involved the setting up of joint CBN/NDIC Interim Management Committee (IMC) to manage the affairs of the MFB to stem the tide of its mismanagement and also to protect the interest of its depositors.

“The sum of N2 billion was released to the Committee by the CBN to pay depositors of the troubled MFB in order to ease their hardship before its licence was revoked.

The corporation also released facts and figures behind the liquidation of Fortis Microfinance.

It attributed the failure of the bank to mismanagement.

The statement said: “As the fortunes of Fortis MFB Plc began to decline due to mismanagement and abysmal corporate governance practices, the CBN, in collaboration with the NDIC, took several actions to address its deteriorating financial condition.

“The intervention of regulatory agencies in the resolution of the defunct Fortis MFB was in two phases. The first phase involved corrective and supervisory measures which eventually included the sacking of the Executive Management, dissolving the Board of Directors and the appointment of a joint CBN/NDIC Interim Management Committee (IMC) to temporarily manage the affairs of the MFB. One of the reasons for the setting up of the IMC, among others, was the need to protect the interests of the depositors.

“The second phase involved the revocation of the operating licence of Fortis MFB by the CBN in December, 2018, when all efforts to turn around its fortunes failed to yield the desired results, and its subsequent liquidation by the NDIC.

“As soon as Fortis MFB’s operating licence was withdrawn, the NDIC in line with its mandate swiftly verified the defunct MFB’s depositors and commenced payment of the insured sums up to the maximum limit.”

It added: “It is important to state here that the liquidation of Fortis MFB is on-going and the Corporation is making all necessary efforts to realise the failed MFB’s any residual assets.

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