Lagos, Nigeria - The Central Bank of Nigeria (CBN) has moved to overturn a landmark judgment of the Federal High Court, Lagos Division, which nullified its takeover of Union Bank of Nigeria Plc and reinstated the bank’s former board of directors.
Justice Chukwujekwu Aneke, in a ruling delivered on March 25, held that the apex bank acted beyond its statutory powers when it dissolved Union Bank’s board and management.
In response, the CBN filed an appeal on March 26, led by a formidable team of Senior Advocates of Nigeria (SANs) including Yusuf Ali, SAN; Kemi Pinheiro, SAN; Tunde Fagbohunlu, SAN; Uche Val Obi, SAN; and Chukwudi Enebeli, SAN.
The appeal raised 11 grounds challenging the lower court’s decision in its entirety.
The apex bank insisted its intervention was lawful under the Central Bank of Nigeria Act and the Banks and Other Financial Institutions Act (BOFIA) 2020, citing Union Bank’s negative capital adequacy ratio, a capital shortfall exceeding ₦224 billion, and high levels of non-performing loans.
The CBN further argued that Section 34 of BOFIA empowers the Governor to remove directors of a distressed bank, while Section 51 shields regulatory actions taken in good faith.
It contended that the trial court misinterpreted these provisions, resulting in what it describes as a miscarriage of justice.
Alongside the appeal, the CBN filed a motion seeking a stay of execution of the judgment, asking the court to restrain reinstated directors from assuming control of Union Bank or altering its governance structures until the appellate court rules.
Respondents in the case include Titan Trust Bank Limited, Luxis International DMCC, Magna International DMCC, and several former Union Bank directors.
They had challenged the CBN’s intervention as the ultimate beneficiaries of Union Bank shares.
In its affidavit, the CBN warned that enforcing the judgment could destabilise Union Bank, erode public confidence in the banking sector, and pose systemic risks.
The apex bank emphasised that the case raises critical questions about the scope of regulatory authority under Nigeria’s banking laws, with implications for financial stability nationwide.
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