The Nigeria Deposit Insurance Corporation (NDIC) has commenced formal proceedings to finalize the liquidation of 89 defunct Microfinance Banks (MFBs) and Primary Mortgage Banks (PMBs), following their resolution under the Purchase and Assumption (P&A) framework.
The affected institutions form part of the 179 microfinance banks and four primary mortgage banks whose operating licences were revoked by the Central Bank of Nigeria (CBN) on May 22 and 23, 2023. The regulatory action was undertaken as part of broader sector reforms aimed at strengthening financial stability and addressing persistent balance sheet weaknesses.
As part of the resolution process, the CBN licensed 89 successor institutions to assume the assets and liabilities of the failed banks. These acquiring entities have since resumed operations under new identities, ensuring continuity of customer accounts and minimizing disruption across the financial system.
With the transition phase now completed, the NDIC—acting in its capacity as statutory liquidator—has advanced to the final stage of the process. This involves filing applications at various divisions of the Federal High Court to obtain dissolution orders and formally conclude its liquidation mandate.
This development marks a notable milestone in Nigeria’s evolving bank resolution framework, which increasingly emphasizes structured intervention mechanisms over disorderly failures. It also underscores the growing adoption of Purchase and Assumption transactions as an effective tool for safeguarding depositors, maintaining financial system stability, and facilitating the orderly exit of distressed institutions.
