MultiChoice, the South African pay-TV company, has disclosed a write-off of N31.6 billion (approximately $21 million) in deposits held with Heritage Bank, following the bank’s liquidation in June 2024. The loss was reported in the company’s financial results for the six-month period ending September 30, 2024.
The initial deposit, which totaled N33.7 billion as of March 31, 2024, had already been partially reduced due to cash remittances before Heritage Bank’s license was revoked by the Central Bank of Nigeria (CBN) on June 3. The Nigeria Deposit Insurance Corporation (NDIC) was then appointed as the liquidator. In its statement, MultiChoice noted that the deposit write-off was included as part of operating expenses, explaining, “Following the revocation of Heritage Bank’s banking license and subsequent liquidation, the group has written off its receivable relating to the cash held with the bank.”
The financial hit is compounded by the ongoing depreciation of the naira, which has increased foreign exchange losses for the company. MultiChoice has also reported a slowdown in funds repatriated from Nigeria, with only $65 million extracted in the first half of FY24, compared to $91 million in the same period last year. At the end of September 2024, the company’s cash holdings in Nigeria had dropped to $11 million, a substantial decrease from $39 million reported at the close of FY24.
Despite these setbacks, MultiChoice is actively pursuing cash remittance from Nigeria, though efforts are constrained by the weaker naira and the recent write-off from Heritage Bank. Although MultiChoice’s deposit exceeds the maximum insured amount of N5 million per depositor, the NDIC has stated that it is working to reimburse depositors with balances above the insured limit through dividends from the liquidation of the bank’s assets.
The financial strain comes as MultiChoice faces further challenges in Nigeria, with a reported 18% decline in active DStv subscriptions and a corresponding drop in overall revenue.
