The Nigeria Deposit Insurance Corporation (NDIC) has commenced the final phase of winding down 89 defunct Microfinance Banks (MFBs) and one Primary Mortgage Bank (PMB), following their successful resolution under the Purchase and Assumption (P&A) model.
According to a statement released on Wednesday, April 15, 2026, the affected institutions were taken over by new investors, recapitalised, and are now operating under new identities after regulatory intervention by the Central Bank of Nigeria.
The move follows the revocation of licences in May 2023 by the Central Bank of Nigeria, which shut down 179 microfinance banks and four mortgage banks as part of efforts to strengthen and sanitise the financial sector.
NDIC said it is now seeking legal closure of the defunct institutions by approaching various divisions of the Federal High Court to obtain dissolution orders and formally discharge itself as liquidator.
“The Corporation will be presenting applications to Judicial Divisions of the Federal High Court to obtain orders of dissolution for the closed banks and to release the Corporation as Liquidator,” the statement said.
The resolution process was carried out under the Purchase and Assumption framework, which ensured that viable assets and liabilities of failed institutions were transferred to stronger financial operators, preventing outright collapse.
According to NDIC, 89 failed banks were successfully resolved through this model, with new owners acquiring their assets and continuing operations under fresh licences issued by the Central Bank of Nigeria.
The Corporation noted that this approach helped preserve depositor funds, maintain access to banking services, protect jobs, and minimise disruption to financial activities across the country.
Many of the affected institutions were small microfinance banks serving low-income earners, small businesses, and informal sector operators, with significant concentration in Lagos as well as other regions including the South-East, South-South, South-West, and northern Nigeria.
NDIC added that several of the restructured institutions have adopted modern, fintech-driven identities, reflecting a broader shift toward digital banking and improved financial services delivery.
The Corporation explained that once the Federal High Court grants dissolution orders, it will formally exit its role as liquidator, marking the final stage of the resolution process.
The development highlights ongoing regulatory efforts to strengthen Nigeria’s financial system and reinforce confidence in deposit protection mechanisms.
It also underscores the effectiveness of the P&A model in balancing depositor protection with financial system stability while allowing continuity of essential banking services.
