Fear grips operators as CBN, NDIC begin liquidation of 42 MfBs
Fear has gripped operators of Microfinance Banks (MfBs) in the country, as the Nigeria Deposit Insurance Corporation (NDIC) says it will verify the claims of stakeholders of the 42 MfBs whose licenses were revoked in the latest efforts of the Central Bank of Nigeria (CBN) to delist insolvent operators from the industry.
The verification exercise by the Corporation is said to hold between Monday 21st and Thursday 24th December at the branches of the MFB with the depositors, creditors, and shareholders of the banks to verify their relationships as well as their deposits in preparatory to their liquidation by the NDIC which is statutorily empowered to do so.
The Central Bank of Nigeria (CBN) on 12 November revoked the licenses of the banks and the NDIC is required to prepare their rites of passage to finally close the regulators’ books on them. CBN and the NDIC had in 2018 revoked the operating licenses of no fewer than 153 Micro-Finance Banks (MFBs) and six Primary Mortgage Banks (PMBs) according to the 2018 Annual Reports of the NDIC and this latest revocation is another in the series of clean up by the two banking regulators.
MFBs according to the CBN have always battled high level of nonperforming loans that always result in high portfolio risk (PAR) and always impair their capital, leading to gross under capitalisation.
“This is to inform the depositors, creditors, shareholders and the general public that the operating licenses of the under listed FortyTwo (42) Microfinance Banks (MFBs) have been revoked by the Central Bank of Nigeria (CBN) effective 12th November 2020”, says the corporation in a publication on its website.
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“The Nigeria Deposit Insurance Corporation (NDIC), the Official Liquidator of the banks whose licenses were recently revoked is in the process of closing the listed banks and pay their insured Depositors”.
“We, therefore, request that all depositors of these banks should visit the closed banks’ addresses and meet NDIC officials for the verification of their claims, commencing from Monday, 21st December 2020 till Thursday, 24th December 2020.
