Recovers N5.23bn from debtors From Cletus Akwaya and Mngusuur Akem in Abuja, 12.01.2004
The Nigeria Deposit Insurance Corporation (NDIC) has declared N10.7 billion as dividends for depositors of 32 of the 34 failed banks in the country now at various stages of liquidation. Also, the Corporation has recovered N5.23 billion from debtors to the closed banks. Liquidation dividend is the payment made by NDIC to failed banks depositors, representating their trapped deposits in excess of the insured limit which at the moment is N50,000. The dividend is usually paid after the assets of the bank had been sold and debts recovered from its creditors. Out of the decared liquidation, N5.7 billion has already been paid out to beneficiaries as at Septemeber this year. Managing Director, NDIC, Mr. Ganiyu Ogunleye, who disclosed this at a press conference hosted by the Federal Ministry of Information and National Orientation in Abuja, said out of the 32 banks, a final dividend of 100 per cent of total deposits had been declared for 10 banks, indicating that their depositors would fully recover their deposits from now onwards. Ogunleye named the banks as ABC Merchant Bank Ltd, Alpha Merchant Bank Plc, Amicable Bank of Nigeria Ltd, ICON Ltd. (Merchant Bankers), and Kapital Merchant Bank Ltd. Others include Nigeria Merchant Bank Ltd, Pan African Bank Ltd, Premier Commercial Bank Ltd, and Rims Merchant Bank Ltd. Ogunleye also disclosed that liquidation dividends had been paid to general creditors of some of the banks, including Pan African Bank (in-liquidation) whose general creditors had been paid N167.25 million, representing about 67 per cent of N254 million declared as liquidation to its creditors as at March, 2003. "The general creditors of Rims Merchant Bank (in-liquidation) had been paid the sum of N139.77 million, representating about 83 per cent of the total amount of about N168.1 million decalred as at the end of June, 2003. Likewise, Amicable Bank declared 100 per cent dividend to its preferred creditors and 10 per cent to other creditors," Ogunleye said. He said the N5.23 billion recovered from debtors of the closed banks was part of the the entire debt stock of N30.21 billion owed all the banks in liquidation as at September 2004. He noted that the debt stock was reduced from the initial level of N35.37 billion to N30.21 billion because N5.16 billion liquidation interest was written off in 2000 following several requests by the debtors. He said 12 projects of Nigeria Export Import Bank (NEXIM) amounting to N81.4 million and 43 National Economic Recons-truction Fund (NERFUND) projects amounting to N124.3 million were returned "in appreciation of the vital role of the real sector in economic development." "The corporation also facilitated the repayment of N3.10 billion government debts to both healthy and distressed banks in 1997," he stated, adding, "that exercise improved the liquidity of many banks." The Managing Director said shareholders of Nigeria Merchant Bank Ltd (United Bank for Africa Plc) and the Ministry of Finance Incorporated (MOFI) were paid liquidation dividends totalling N620million based on their ownership ratio of 40:60 while N293 million had been paid to Rivers and Bayelsa State Governments, former owners of Pan frican Bank Ltd, as liquidation dividend. At the briefing were Minister of State for Finance, Mrs Nenadi Esther Usman, Chairman, Senate Committee on Banking, Insurance and Other Financial Institutions, Senator Farouk Bello and representative of the Minister of Information and National Orientation as well as operators in the financial services sector.
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