Multichoice Group has confirmed that it has written off the N31.6 billion ($21 million) in cash it held with the recently liquidated Heritage Bank.
This information was disclosed in the company’s financial results for the six months ending September 30, 2024.
The Group had in its FY 2024 annual report, released in June, reported a deposit of N33.7 billion with the bank as of March 31, 2024, prior to the bank’s liquidation.
The balance of N33.7 billion previously reported was reduced to N31.6 billion due to cash remittances made prior to Heritage Bank’s liquidation on June 3, 2024.
“Following the revocation of Heritage Bank’s banking licence by the Central Bank of Nigeria on 3 June 2024 and its subsequent liquidation, the group wrote-off its receivable relating to the cash held with the bank,” Multichoice stated in a note to the $21 million listed as part of its operating losses for the half-year under review.
The Group noted that the continued depreciation of the naira against the US dollar led to additional foreign exchange losses on non-quasi equity loans, particularly the USD-denominated intergroup loan from MultiChoice Africa Holdings B.V. to MultiChoice Nigeria Limited.
Despite these challenges, the Group successfully repatriated some funds from its Nigerian operations to its headquarters, although the amount was lower compared to the previous year.
“The group extracted USD65 million from Nigeria in the period (1H FY24: USD91 million) at an average rate of NGN1,516:USD (1H FY24: NGN794:USD), incurring extraction losses of USD1 million or ZAR20 million (1H FY24: USD28 million or ZAR518m) in the process.
“The group held USD11 million in cash in Nigeria at period-end, down from USD39 million at end FY24, a consequence of consistent focus on remitting cash, the impact of translating the balance at the weaker naira and the write-off of the USD21 million receivable relating to the cash held with Heritage Bank before its license was revoked and the bank was liquidated,” it stated.
After the Central Bank of Nigeria revoked Heritage Bank’s banking license on June 3, 2024, the Nigeria Deposit Insurance Corporation was appointed as the liquidator.
The NDIC has since begun reimbursing insured deposits, with a maximum payout of N5 million per depositor. While Multichoice had stated in June that it would work with the NDIC to “ensure a reasonable outcome” for its funds in the liquidated bank, its deposit exceeds the insurance coverage limit.
