Nationalised Banks: Shareholders Drag CBN To Court

Shareholders of Afribank, Bank PHB and Spring Bank on Tuesday dragged the Central Bank of Nigeria before a Federal High Court in Abuja seeking to set aside the nationalisation of the banks on the ground that it was done illegally.

Suing under the names of the Incorporated Trustees of Proactive Shareholders Association of Nigeria, Ibadan and the Incorporated Trustees of Truth and Transparency Initiative, the shareholders filed the suit before the Federal High Court.

The shareholders said that they were entitled to nominate directors into the banks to represent them and that the CBN did not have the power to choose the directors who would represent them in the banks.

The aggrieved shareholders who lost out in the nationalisation exercise also sought for an order that in the event of nationalisation, that they ought to be on the board of the companies and that a reputable accounting firm which is acceptable to the shareholders or any other accounting firm which the court may deem fit should be appointed to audit the accounts of the banks from 2009 to date of judgment of the court and to submit their audited report within 60 days from the making of the order.

They further prayed for an order of perpetual injunction restraining the CBN from changing the name of the banks to any name without the approval of the shareholders in a duly convened meeting of the companies.

The originating summons which was filed at the registry of the court through the plaintiffs’ counsel, Mr. Nnodu Okeke, is asking the court to determine whether under existing laws there were provisions for nationalisation of banks in Nigeria.

The shareholders also asked the court to determine whether the nationalisation could be done by mere pronouncement by the apex bank and not by an Act of the National Assembly.

Apart from CBN, other defendants are: Afribank PLC, Bank PHB, Spring Bank PLC, Mainstreet Bank Limited, Keystone Bank Limited, Enterprise Bank Limited, Mr. Gideon Agbedo, Mr. Benson Igbanoi, and Mr. Barnabas Olowoselu.

Others are Mr. Falalu Bello, Mrs Faith Tuedor Matthew, Mr. Oti Ikomi, Mr. Emeka Onwuka, Mr. Ahmed Kuru and the Corporate Affairs Commission, CAC.

They further want the court to determine whether the apex bank can nationalise banks without consultation with the shareholders of the banks and whether it can transfer such nationalised banks to private individuals or companies formed by private individuals.

The shareholders also want the bank to determine whether the conversion of the affected banks is legal, stating that whether in the event of nationalisation of a bank, the CBN can choose whomsoever it desires as the directors of the bank without recourse to approval of the National Assembly.

They also want the court to determine whether the action of CAC is legal by registering Shoko Chukin Limited, Resolution Limited, Kinki Osaka Custodian Limited which purportedly changed their names to or metamorphosed into Mainstreet Bank Limited, Keystone Bank Limited and Enterprise Bank Limited, is legal or not in accordance with the provisions of Section 27(2)(b) of the Companies and Allied Matters Act, CAMA.

They are asking the court to declare that by the extant laws there is no provision for nationalisation of banks in Nigeria and that even if CBN could nationalise banks, it cannot be done by mere pronouncement but by an Act of the National Assembly.

They therefore prayed the court to give an order setting aside the purported conversion of the nationalised banks to Mainstreet Bank Limited, Keystone Bank Limited and Enterprise Bank Limited and also set aside the purported registration by CAC of the new banks previously registered as Shoko Chukin Limited, Michi Noku Resolution and Kinki Osaka Custodian Limited respectively.

By Nnamdi Felix / Abuja