The dissolution of the board of Union Bank of Nigeria (CBN) by the Central Bank of Nigeria (CBN) in January 2024 has been nullified by a Federal High Court in Lagos.
In a judgment on Wednesday, Justice Chukwujekwu Aneke ordered the immediate reinstatement of the affected board members.
This ruling has now invalidated all actions taken by the central bank regarding the lender’s leadership change.
Justice Aneke held that the apex bank had no authority to remove the board members, declaring the CBN’s action as “ultra vires.”
Over two years ago, the central bank changed the boards of Union Bank, Polaris Bank, and Keystone Bank, accusing them of violating “sections of the Banks and Other Financial Institutions Act (BOFIA) 2020.”
The sacking of the Union Bank board happened after it was speculated that its acquisition by Titan Trust Bank was suspicious, with some alleging that the embattled former Governor of the CBN, Mr Godwin Emefiele, sold the lender to a proxy.
“This action became necessary due to the non-compliance of these banks and their respective boards with the provisions of Section 12(c), (f), (g), (h) of the Banks and Other Financial Institutions Act, 2020. The Bank’s infractions vary from regulatory non-compliance, corporate governance failure, disregarding the conditions under which their licenses were granted, and involvement in activities that pose a threat to financial stability, among others,” a part of the statement issued by the Acting Director for Corporate Communications at the CBN, Mrs Sidi Ali Hakama, said.
Later, the apex bank appointed Ms Yetunde Oni as the chief executive of Union Bank, with Mannir Ubali Ringim appointed as an executive director.
After the CBN’s action, Titan Trust Bank, Luxis International, and Magna International, which are the core shareholders of Union Bank, challenged the legality of the action in court.
They asked the court to restrain the CBN, Union Bank and the appointed directors from taking further steps pending the determination of the suit.
At today’s judgment, Justice Aneke granted this prayer, restraining the central bank, its agents and appointees from taking any further steps concerning the financial institution, including actions relating to its proposed recapitalisation or any associated measures.