The Nigeria Deposit Insurance Corporation has accused some debtors of failed banks of deliberately blocking loan recovery, through hidden assets, court delays and intimidation practices it says slow the return of money to depositors.
Ogungbemi Theophilus, Director of the NDIC’s Asset Management Department, raised the alarm on Monday at a stakeholders’ seminar and public relations workshop in Wuye, Abuja. He said too many borrowers act as if a bank’s licence revocation cancels their duty to repay.
“Some debtors of failed banks believe that because a bank’s licence is revoked, they are not obliged to fulfil their responsibilities anymore. They hide assets. They frustrate service. They employ delay tactics in court. Sometimes they try to intimidate. But we have to always do our job, and professionally too,” he said.
Why Recovery Gets Harder After a Bank Fails
Recovering loans after a bank is closed is already difficult. Debts that were unpaid when the bank was operating do not become easier to collect once it is liquidated. Theophilus warned that every delay reduces what can eventually be paid to depositors: empty buildings lose value, equipment deteriorates, and old loans become harder to enforce.
“Every delay slows payment to depositors,” he said.
The Asset Management Department handles loans, properties and investments of closed deposit money banks, primary mortgage banks and microfinance banks. Its job is to recover debts, sell assets and turn them into cash so that uninsured depositors can be paid.
Who Gets What
Depositors at deposit money banks, non-interest banks and mobile money operators are insured up to ₦5 million per depositor per bank. Those at microfinance banks, primary mortgage banks and payment service banks are covered up to ₦2 million.
That cover fully protects about 99% of depositors. Anyone with balances above the insured limit depends on liquidation dividends money raised from recovered loans and sold assets for the rest. For them, the insured payout is only the first instalment.
Recent Asset Sales
The corporation held public auctions by competitive sealed bidding on 3 and 4 November 2026 for physical assets of three banks in liquidation: Union Homes Savings and Loans, Heritage Bank, and Resort Savings and Loans. The sales took place in Lagos, Taraba and Adamawa states, coordinated by the Asset Management Department and run by appointed auctioneers.
Cost Discipline and Zero Tolerance for Abuse
Theophilus cautioned that recovery costs must not swallow the value recovered. Spending ₦10 million to collect ₦8 million, he said, leaves depositors worse off. He also warned professionals involved in recovery against insider dealing, deliberate undervaluation, collusion with buyers or diversion of proceeds, stating that the NDIC has zero tolerance for conduct that short-changes depositors.
The corporation is developing a fuller Asset Management Policy to tighten identification, documentation, valuation, disposal and accountability. It also plans closer work with auctioneers, valuers, sales agents and surveyors to speed recoveries and depositor payments.
The Abuja event is one of three stakeholder seminars planned for Abuja, Enugu and Lagos, aimed at fixing operational bottlenecks and improving outcomes for people still waiting for funds from failed banks.
