NDIC To Pay Depositors Of Defunct Peak Merchant Bank, Begins Verification

The Nigeria Deposit Insurance Corporation (NDIC) has commenced verification of insured depositors of Peak Merchant Bank in-liquidation towards payment of their insured sums.

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NDIC”s Director of Communication & Public Affairs, Bashir A. Nuhu who disclosed this in a statement on Sunday, said, the exercise was in line with its mandate of deposit guaranty and reimbursement of depositors in the event of bank failure.

The Corporation said, the verification exercise would enable depositors of the defunct bank to cross-check and ascertain their account information as well as balances with the bank as at closure.

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It further stated that the process was a prelude to the payment of insured sums to such depositors.

It therefore, enjoined depositors to visit the bank’s old premises or the Corporation’s office nearest to them with proof of account ownership and verifiable means of identification for the exercise.

The NDIC added that insured sum was the first and mandatory payment that depositors are paid, up to specified limit, if a bank fails.

“Depositors are paid amounts in excess of the insured sums subsequently, as liquidation dividends from proceeds of the closed bank’s assets as realised by NDIC as liquidator”, it said.

It could be recalled that the banking licence of Peak Merchant Bank was revoked by the Central Bank of Nigeria (CBN) on Friday, February 28, 2003 in line with section 12 [d] of the Banks and Other Financial Institutions Act (BOFIA) 1991 as amended.

CBN explained that “Peak Merchant Bank Limited was characterised by weak and incompetent Board and Management, insolvency and the overbearing influence of the chairman who was also a major shareholder in the bank, it had suffered from persistent illiquidity, poor asset quality, significant insider abuses and poor track record of profitability”.

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