Court orders full reversal of CBN’s Union Bank takeover
…Says its illegal
The Federal High Court in Lagos has ruled that the Central Bank of Nigeria acted beyond its legal powers in its controversial takeover of Union Bank of Nigeria, declaring the January 2024 intervention unlawful.
Delivering judgment, Justice Chukwujekwu Aneke held that the apex bank’s dissolution of the lender’s board and management violated provisions of the Banks and Other Financial Institutions Act 2020, describing the move as ultra vires. The ruling was issued in Suit No: FHC/L/MISC/1377/2025.
The case was brought by Titan Trust Bank Limited, alongside Luxis International DMCC and Magna International DMCC, who asserted their status as the ultimate beneficial owners of Union Bank. They challenged the CBN’s sweeping actions, which included removing the bank’s leadership, installing new management, and launching a recapitalisation drive that allegedly diluted their ownership and sidelined them from decision-making.
In a decisive judgment, the court nullified the entire intervention. It struck down the CBN’s announcement dissolving the board, invalidated all decisions made by the regulator-appointed management, and ordered the immediate reinstatement of the former leadership under Mr. Farouk Mohammed Gumel.
Justice Aneke further restrained the CBN and its agents from interfering in the bank’s governance, including any attempt to restructure its shareholding or alter ownership. The ongoing recapitalisation programme and investor selection process initiated under the disputed management were also halted.
Beyond statutory breaches, the court held that the applicants’ fundamental rights were violated. It found that sanctions were imposed without fair hearing, despite allegations stemming from a regulatory examination of the bank.
The judge highlighted that the claimants’ stake had been slashed from full ownership to 40 percent without legal justification, and that their exclusion from the recapitalisation process reflected bad faith.
Although the CBN defended its actions as necessary oversight—citing financial distress, a negative capital adequacy ratio, a capital deficit exceeding N224 billion, and rising non-performing loans—the court maintained that regulatory authority must be exercised strictly within legal bounds.
On jurisdiction, the court clarified that Section 51 of BOFIA does not shield the CBN from judicial scrutiny when it exceeds its mandate. It also ruled that the regulator-appointed board functioned as agents of the apex bank and remained subject to review.
Procedural objections raised by the respondents were dismissed, with the court noting that the applicable rules were not strict enough to invalidate the suit.
Justice Aneke also recognised that the applicants suffered a “continuing injury,” having been excluded from the bank’s management and major corporate decisions between January 2024 and December 2025.
While acknowledging that the applicants invested $190 million in the bank, the court declined to award additional damages due to the absence of oral evidence supporting further claims.
