The Nigeria Deposit Insurance Corporation has initiated legal proceedings against Wema Bank at the Federal High Court in Lagos, seeking recovery of high-value assets and disputed funds linked to the defunct Gulf Bank Plc.
The suits, filed under the Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Act, centre on 12 properties located in Banana Island, currently valued at approximately ₦125.38 billion, as well as an alleged unauthorised payment of ₦401 million.
Asset Recovery Dispute
According to court filings, the NDIC acting as liquidator of Gulf Bank following the revocation of its licence by the Central Bank of Nigeria in January argues that the properties were originally acquired through entities linked to the defunct bank.
The corporation is requesting the court to declare any disposal of the assets unlawful and compel Wema Bank to either return the title documents or compensate for their current market value.
Allegations of Improper Transactions
In a sworn statement, former NDIC official Joseph Okolonji stated that investigations uncovered alleged attempts to divest six of the properties—registered under Euston Wenberg Engineering Company Limited under questionable circumstances.
The properties, spanning approximately 13,794 square metres, are currently estimated at over ₦62 billion. However, NDIC claims Wema Bank presented them as having been sold for just ₦250 million, despite lacking a demonstrable legal interest in the assets.
The corporation further asserts that no credible evidence exists to support Wema Bank’s claim of holding the assets based on an interbank placement of ₦771.79 million allegedly linked to Gulf Bank.
Disputed Financial Claims
NDIC cited findings from a joint examination conducted in 2005 with the Central Bank, which reportedly found no record of the alleged deposit in Gulf Bank’s accounts. Supporting documentation such as placement records or account statements was also said to be absent.
Additionally, NDIC challenged the validity of two managers’ cheques totalling ₦250 million, issued by Access Bank and Intercontinental Bank, describing the valuation as inconsistent with prevailing property prices in Banana Island at the time.
Second Suit: Additional Properties Under Scrutiny
In a related suit, NDIC is contesting ownership of another six Banana Island properties acquired through Bacad Finance and Investment Limited (later renamed Supra Commercials Limited), in which Gulf Bank reportedly held a controlling interest.
These properties, covering nearly 14,000 square metres, are currently valued at approximately ₦62.91 billion. NDIC alleges that Wema Bank assumed control of the assets and claimed they were purchased for ₦524 million via managers’ cheques issued between 2006 and 2007.
The corporation also accused Wema Bank of collecting ₦401 million from the United Bank for Africa in 2009, despite an earlier approved liquidation amount of approximately ₦1.63 million.
Elements of the transactions have reportedly been referred to the Economic and Financial Crimes Commission for further investigation.
Wema Bank Challenges Jurisdiction
Wema Bank, represented by Senior Advocates including Oladapo Olanipekun, Kehinde Ogunwunmiju, and Tunde Afe-Babalola, has contested the court’s jurisdiction.
The bank maintains that the dispute does not arise from a banking transaction within the scope of the Failed Banks Act and argues that no debtor-creditor relationship exists between the parties. It further contends that the claims are statute-barred, citing that the transactions occurred between 2006 and 2007.
