NDIC Initiates Final Dissolution of 89 Failed Banks Following Successful Purchase and Assumption Agreements

The NDIC moves to dissolve 89 microfinance and mortgage banks after successful asset acquisitions, ensuring the final legal closure of failed 2023 institutions.

By: AXL Media

Published: Apr 16, 2026, 4:48 AM EDT

Source: Information for this report was sourced from LEADERSHIP

A Formal Conclusion to Bank Liquidation Processes

The Nigeria Deposit Insurance Corporation (NDIC) is taking definitive steps to wrap up the liquidation of dozens of financial institutions that were previously closed due to operational failures. According to Hawwau Gambo, the head of Communications and Public Affairs at the NDIC, the corporation is now focusing on the legal finality of 89 specific microfinance and primary mortgage banks. These entities have undergone a resolution process that has transitioned their core operations to new, eligible owners, marking a significant milestone in the corporation’s effort to manage bank failures within the Nigerian financial system.

Regulatory Intervention and License Revocation Context

The current liquidation activities are a direct result of a major regulatory intervention by the Central Bank of Nigeria (CBN) that took place in May 2023. During that period, the apex bank revoked the operating licenses of 179 microfinance banks and four primary mortgage banks, citing persistent non compliance and severe operational deficiencies. This widespread revocation triggered the NDIC's mandate as a liquidator to protect depositors and maintain systemic stability by finding viable paths for the distressed assets of the affected banks.

The Mechanics of Purchase and Assumption Resolution

Rather than a simple payout of insured deposits, the NDIC utilized the Purchase and Assumption (P&A) model for 89 of these institutions. Under this framework, 89 new eligible institutions were granted licenses by the CBN to acquire the assets and assume the liabilities of the defunct banks. This model allows for a seamless transition where the new owners can continue providing financial services under different names, effectively preserving the banking infrastructure while protecting the interests of the original depositors.