Multichoice's N31.6bn Stuck in Heritage Bank

Multichoice Group's N31.6 billion deposit stuck in Heritage Bank after liquidation, exceeding NDIC's N5 million maximum payout. Company to collaborate with liquidator for reasonable outcome, amidst uncertainty over timeline and fate of funds.

Multichoice Group, the parent company of DSTV, had a substantial account balance of N31.6 billion with Heritage Bank before the bank's liquidation. 

According to Multichoice's annual report for the fiscal year 2024, the company had deposited N33.7 billion (equivalent to 488 million South African Rands) with the bank as of March 31, 2024. However, this balance was later reduced to N31.6 billion (ZAR 400 million) due to cash remittances before the bank's liquidation on June 3, 2024.

The significant deposit raises concerns for Multichoice Group, as it exceeds the N5 million maximum payout guaranteed by the Nigeria Deposit Insurance Commission (NDIC). 

However, the company plans to collaborate with the liquidator (NDIC) to achieve a reasonable outcome. In a press release issued on June 3, 2024, the NDIC announced the liquidation of Heritage Bank, stating that depositors with funds exceeding N5 million would receive a liquidation dividend, subject to the realization of the bank's assets and the recovery of its outstanding debts.

As part of the liquidation process, the NDIC has initiated a public bidding process for the sale of Heritage Bank's assets. 

Read Also: Heritage Bank's Head Office and 47 Other Properties Listed for Sale by NDIC

Multichoice Group will likely need to wait for the outcome of this process to determine the fate of its deposited funds. The company's annual report indicates its commitment to working with the liquidator to achieve a reasonable outcome, but the exact timeline and outcome remain uncertain.

In a statement issued on June 13, 2024, the NDIC declared, “The Nigeria Deposit Insurance Corporation, in its capacity as the Liquidator of failed Deposit Money Banks, invites interested members of the public to participate in the public competitive bidding for the acquisition of assets (real estate and chattels) of the defunct Heritage Bank.”

In addition, Multichoice Group and Heritage Bank had a longstanding and collaborative relationship, with the bank serving as a key sponsor for several of the group's high-profile initiatives. These included the popular reality TV show Big Brother Naija and the prestigious Africa Magic Viewer's Choice Awards (AMVCA). This partnership highlighted the bank's commitment to supporting the creative industry and entertainment sector in Nigeria.

The bank's sponsorship of these events demonstrated its dedication to promoting African talent and creativity, aligning with Multichoice's mission to showcase the best of African entertainment. 

The partnership between Multichoice and Heritage Bank was a testament to the power of collaboration and mutual support in driving growth and innovation in the industry. However, the liquidation of Heritage Bank has now raised concerns about the fate of Multichoice's deposited funds, as previously mentioned.