By Innocent Anaba

The legal battle between some shareholders of Union Bank Plc, Finbank Plc, Intercontinental Bank Plc, Afribank Plc and the Central Bank of Nigeria, CBN, over the take-over of their banks and in some cases, sale of their banks to other banks even when there are pending cases in court challenging the propriety of the take-over of the banks, commenced last week at the Court of Appeal, Lagos.

The appeal by Akingbola, who had at the lower court, claimed that the CBN was bent on selling the bank to Access Bank, was heard on Tuesday, last week.

At the lower court, the matter was dismissed as an abuse of court process, which was why he and other shareholders opposed to the sale went on appeal.

The appellate court, adjourned till February 20, 2012 for parties to adopt their written addresses in the appeal by Akingbola, challenging the ruling of a Federal High Court, Lagos, which dismissed his suit, challenging the planned sale of his former bank to Access Bank.

Akingbola’s counsel, Mr. Onyebuchi Aniakor, had told the court that he had not been able to finish compiling record of proceedings from the lower court, but promised to conclude it in seven days.

Akingbola and Bayo Dada were insisting that CBN was wrong to have masterminded the signing of the said MoU without recourse to them as shareholders and former directors of Intercontinental Bank.

Dada had specifically urged the court to set aside a letter issued by CBN removing him from the Board of Intercontinental Bank. Akingbola and Dada in the appeal are contending that the lower court made fundamental errors in its judgment.

Union Bank shareholders in their suit at the lower court, challenging plans to sell their bank to ACA, had contended that their bank was strong, as the CBN was only bent on taking over the bank.

They also accused the management installed by the CBN of hemorrhaging the bank with their wasteful spending on exotic cars and bogus salaries, but they lost at the lower court, as the trial judge held that the matter was statute barred, which was also why they went on appeal and the matter did not go on last Wednesday, as Court 2 of the Court of Appeal, Lagos, did not sit.

For Finbank, some of the former bank chiefs and shareholders had also challenged plans to sell their bank to First City Monument Bank by the CBN, contending that the apex bank had done everything possible, including arm twisting, even though it knew that there was a pending suit challenging its takeover of the bank, but despite same, had concluded plans to hand over the bank to FCMB for a stipend and at a great loss to original owners of the bank.

They were ruled against at the lower court and had appealed, while the matter, which was supposed to come up last Thursday, also at the Court of Appeal, did not go on, as the court did not sit.

Bank PHB shareholders had also challenged plans by CBN to sell their bank to a foreign bank, Habib Bank Limited Pakistan, at a great loss to them as Nigerian owners, but same was dismissed by the lower court as being premature.

The shareholders and directors of the affected banks, had argued that the CBN Governor had carried on with his disposing of the banks at ridiculously give-away prices in disregard to them as owners of the banks and had used his powers in the most oppressive way to the detriment of the interest of the owners of these banks, who had invested billions of naira to capitalise the bank.

They are respectively, asking the Court of Appeal, to overturn the various lower court decisions, also drawing the attention of the appellate court to the fact that most of the steps taken by the CBN governor were during the pendency of the various suits.

They are further arguing that the actions of the CBN governor were aimed at frustrating their respective cases, which were yet to be determined on merit. They also faulted most of the lower court decisions.

For instance, Akingbola and other shareholders in their case before Justice Okechukwu Okeke of the lower court, wondered why the judge would conclude that they never denied the pendency of other suits on the same subject matter, when they had categorically denied the pendency of similar suits, as they had argued that other pending suits were different in that parties are not the same and subject matter also not the same.

While same suits sought to be tendered by the defendants were also not certified as provided under the law, which renders them inadmissible, yet the court went on to claim that they(plaintiffs) did not deny the pendency of similar suits.

Some of the shareholders, who spoke to Vanguard, expressed confidence in the Court of Appeal to right the wrong done by the CBN and lower courts to Nigerian shareholders, most of whom borrowed money to buy shares in these banks, which were now being given away to other banks and favoured individuals by the apex bank at a ridiculously low price, without them having a say.

In the case of Bank PHB Plc, the affected shareholders are challenging plans by the CBN to sell their bank to Habib Bank of Pakistan, while for Union Bank, they are challenging plans to sell their bank to African Capital Alliance, ACA.

It will be recalled that recently, one of the banks taken over in 2009 and two others, were renamed.

The banks affected include: Afribank Plc, Bank PHB and Spring Bank Plc, and renamed Mainstreet Bank Ltd., Keystone Bank Ltd. and Enterprise Bank Ltd, respectively.

Shortly after the August 14, 2009 sack of the management and board of some of these banks, some of the sacked chief executives, board members and shareholders headed to court, challenging the take-over of their banks.

They had contended basically that the CBN, which claimed it acted based on a report of its committee, did not allow them (sacked management) to respond or reply to issues and allegations raised in the report before they were removed.

They had also argued that while in the case of Equitorial Trust Bank, the shareholders and management were given the opportunity of injecting the required funds to shore-up its capital base, a different measure was applied to them being shareholders of Union Bank, Finbank, Afribank and Intercontinental Bank.

It will also be recalled that ruling on one of such cases before the Federal High Court, Justice James Tsoho, had held that Mallam Lamido Sanusi, Governor of CBN, lacked the absolute power to sack bank executives without disclosing the findings and recommendations of the special examination conducted into the books of the respective banks to the affected directors.

The judge had also held that though the CBN has power under Section 35 of the Banks and Other Financial Institutions Act, BOFIA, to regulate and control the business of banking, when such powers would fundamentally affect interested parties, there should be disclosure.

Sanusi, it will be recalled had claimed that the removal of the bank chiefs became necessary following the revelations contained in a special examination conducted into the books of all the 24 banks in the country, which showed that the affected directors mismanaged the affairs of their respective banks and also put the banks in grave situation.

The sacked bank chiefs were former Managing Director of Intercontinental Bank, Erastus Akingbola and his counterparts in Finbank (Okey Nwosu), Afribank (Sebastine Adigwe), Oceanic Bank (Cecilia Ibru), Union Bank (Barth Ebong), Spring Bank (Charles Ojo), Bank PHB (Francis Atuche) among others.