The Central Bank of Nigeria (CBN) has filed an appeal against the judgment of the Federal High Court in Lagos, which nullified its takeover of Union Bank of Nigeria Plc and ordered the reinstatement of the bank’s former board of directors.

The appeal follows the March 25, 2026, decision of Justice Chukwujekwu Aneke of the Federal High Court, Lagos Division, which held that the apex bank acted outside its statutory powers when it dissolved the board and management of Union Bank.

In a move to challenge the ruling, the CBN has assembled a high-profile legal team of Senior Advocates of Nigeria (SANs), led by Yusuf Ali, SAN.

Other members of the legal team are Kemi Pinheiro, SAN; Tunde Fagbohunlu, SAN; Uche Val Obi, SAN; and Chukwudi Enebeli, SAN.

The appeal was filed on March 26, 2026, with the CBN raising 11 grounds to contest the trial court’s decision in its entirety.

The apex bank argued that its intervention in Union Bank was lawfully carried out under the provisions of the Central Bank of Nigeria Act and the Banks and Other Financial Institutions Act (BOFIA) 2020.

According to the CBN, evidence before the lower court showed that Union Bank was in severe financial distress at the time of the intervention, with a negative capital adequacy ratio, a capital shortfall exceeding N224 billion, and a high volume of non-performing loans.

It maintained that those conditions justified urgent regulatory action aimed at preserving the stability of the bank and protecting the broader financial system.

The CBN further contended that Section 34 of BOFIA empowers its Governor to remove directors and officers of a bank in a critical condition, while Section 51 shields actions taken in good faith in the course of discharging statutory duties.

The regulator argued that the trial court failed to properly interpret those provisions, leading to what it described as a miscarriage of justice.

It also faulted the lower court for declaring its intervention unlawful, ultra vires, and unconstitutional, and for nullifying actions taken by the management it appointed, including board resolutions and administrative decisions, without establishing a legal basis for reinstating the former board.

Alongside the appeal, the CBN filed a motion on notice seeking a stay of execution of the judgment pending the determination of the appeal.

In the application, the apex bank asked the court to restrain the reinstated directors and other respondents from assuming control of Union Bank, interfering with its operations, convening board or management meetings, or making changes to the bank’s governance structure.

The CBN also urged the court to prevent the respondents from engaging in media campaigns or other actions that could destabilise the bank, while seeking an order directing all parties to maintain the status quo until the appeal is decided.

The respondents in the appeal include Titan Trust Bank Limited, Luxis International DMCC, Magna International DMCC, as well as several former directors of Union Bank, including Bayo Adeleke and Yetunde Oni.

They had approached the Federal High Court as the ultimate beneficiaries of Union Bank shares, challenging the CBN’s intervention in the bank’s affairs.

In an affidavit supporting its application for stay of execution, the CBN warned that enforcing the judgment could trigger disruption in Union Bank’s governance and operations, weaken public confidence in the banking sector, and expose the financial system to potential systemic risks.

The apex bank stressed that its appeal raises substantial legal questions about the extent of its regulatory powers under Nigeria’s banking laws, particularly BOFIA 2020.

It argued that unless the execution of the judgment is suspended, the appeal may be rendered nugatory.

According to the CBN, preserving the status quo is essential to safeguarding banking sector stability while the appellate court determines a dispute that could significantly shape the scope of regulatory authority in Nigeria’s financial sector. (Nigerian Tribune)

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