BEFORE the removal of the seven banks chief executives in August and October 2009 by the Central Bank of Nigeria (CBN) Governor, Mallam Sanusi Lamido Sanusi, it was evident that the apex bank was ready to sell the rescued banks. It had earlier expressed its resolve to seek fresh consolidation that would allow the emergence of 15 out of the then 25 banks.Under that proposal, the CBN was to encourage merger and acquisition among the operators, unlike the 2004 exercise where it concentrated on raising the banks capital base to N25 billion.A sources at the apex bank had then claimed that the CBN was worried over the bubble capital saga rocking the nations financial institutions, accentuated by high-profile dangerous loans given by the banks, under assessed poor management regime.The CBNs governor, indicated that the re-consolidation of the banks would be two-fold as foreign banks would acquire Nigerian banks and some strong local banks would also take over their weaker ones.He also set a time table on the planned sale of the five troubled banks, which he said will soon be released by the Central Bank of Nigeria (CBN).Addressing a packed audience in London on the current reforms in the banking sector, which he initiated, Sanusi said the CBN would in due course make a public call for expressions of interest, in the affected banks.Barley a month after, the five bank executives were sacked and were later charged to court for various offences ranging from illegal granting of unsecured loans and other corruption related charges.About N400 billion was also injected into the concerned five banks, which include, Intercontinental Bank Plc, Union Bank of Nigeria Plc, Oceanic International Bank Plc, Finbank Plc and Afribank Plc and later Bank PHB and Spring Bank PLCSanusi, in taking that decision at the Emergency Bankers Committee convened by the CBN in Lagos, explained that it was done safeguard the financial sector from systemic collapse.He said following the audit exercise conducted by CBNs examiners it was discovered that five of the banks had accumulated margin loans of N500 billion, among other loans, that had gone bad and eroded their shareholders funds.Some of these banks are quite large institutions and they have been mismanaged, so we had to move in to send a strong signal that such recklessness on the part of bank executives will no longer be tolerated.He said the CBN had obtained the approval of the President to inject N400 billion into the affected banks to shore up their tier 2 capital to minimum acceptable levels.Sanusi added that the funds being injected by the CBN was just temporary and does not translate to government taking a stake in the five banks, as the interim management would be given a period to recapitalise the affected institutions, following which the N400 billion will be paid back to the CBN.The CBN, he stated, stands ready to ensure that no bank collapses in the country, but will encourage them to seek funds to raise fresh capital and merge with stronger banks.He said an interim management and board for the affected banks would be put in place to run the institutions until they are taken over by new management teams and owners.But stakeholders had queried the method deployed by the CBN governor in encouraging mergers and acquisition for the troubled banks. Some shareholders of the Intercontinental Bank Plc had dragged the management of the bank and the CBN before a Federal High Court, Lagos over plan to sell their bank to Access Bank Plc, which they viewed as even weaker before the take over. The same goes for Platinum Habib Bank Plc (Bank PHB ) as litigation trails CBNs planned sale of the bank to Habib Bank Limited of Pakistan without recourse to them.In a petition before Justice Binta Murtala-Nyako, 10 shareholders of Intercontinental Bank are challenging the propriety of the planned sale of their bank to Access Bank.They are urging the court to halt the process because it would occasion substantial injustice to them and their shares.According to the petition, the shareholders want the court, presided over by Justice Binta Murtala-Nyako, to nullify the Memorandum of Understanding (MoU) between Intercontinental Bank and Access bank.In the said MoU, which was tendered as exhibit in support of the petition by the shareholders, an agreement was said to have been entered, to the effect that Access Bank will pay N50 billion to acquire 80 per cent of Intercontinental Bank shares, while the balance of 20 per cent will be shared between the existing shareholders and the Assets Management Corporation of Nigeria (AMCON).The shareholders, including Okoli Emeka, Ibekwe Adinuba, Sangobiyi Oluyemi, Fatola Olufunmilade, Afolaranmi Olufemi, Quadri Sulaiman, Muogbo Obiora, Awosanya Ojubayo, Ogunyemi Olusegun and Ighekpe Imoape, also added a new twist to the legal battle, when they noted that those that are actually planning to buy their bank are indebted to them, and that the said indebtedness remained uncertain, unclear and unknown as at date.The shareholders insisted that the process would occasion substantial injustice to them and their shares.The shareholders further stressed that they were shocked to learn that the defendants have commenced steps at disposing the assets and shares of Intercontinental Bank without reference to them as members and shareholders of the bank.They added that their investigation revealed that Alabi and other directors of the bank, under the active direction of the CBN and its governor, Lamido Sanusi, have entered into an agreement with Access bank for the acquisition of their bank under the MoU bearing DRAFT 06.02.11.The shareholders are therefore urging the court to compel the defendants to render an account of their dealings in the bank, and an order that a general meeting of the members of Intercontinental Bank be convened forthwith for the purposes of the consideration of the account of dealings of the defendants in the bank and the election of directors for the bank out of its shareholders.They also want an order appointing the President of the Chartered Institute of Bankers (CIB) or any other fit and proper person as may be nominated by the CIBN President under the directions of the court as Receiver/Manager of Intercontinental Bank to realise and secure the assets of the bank pending the holding of the general meeting of the bank.For the aggrieved shareholders of Bank PHB, they are querying the rationale behind the move by the CBN to sell the bank to Habib Bank Limited Pakistan, a bank that failed to meet the consolidation regime.In the suit before Justice Charles Archibong, the shareholders, including Shofolahan Sunday, Ajani Tunde Oluwole, Anyanwu Chukwuma Leonard, Orji Azubuike Sunday and Akpala Ojore are urging the court to restrain the CBN and 11 other respondents from jointly and/or severally, whether by themselves or through their agents, from howsoever taking any steps and /or further steps to dispose off and/or sell or any manner whatsoever alienating any of the banks investments and other assets, including but not limited to the banks business, operations and affairs to Habib Bank Limited, Pakistan, or any other person and /or in any other manner whatsoever altering the shareholding structure of the bank in favour of Habib Bank Limited, Pakistan or any other such entity.The petitioners said notwithstanding that on October 2, 2009, in the absence of any lawful cause, the CBN and/or its governor purported to have removed the managing and executive directors of the bank appointed by the members and/or shareholders and to have replaced these persons with the 2nd to 5th respondents, the CBN and/or its governor, on alleged claim that the bank was in a grave situation, claimed to have injected N70 billion into Bank PHB upon the terms and conditions determined by the CBN and/or its governor that were imposed upon the 2nd to 13th respondents.According to the plaintiffs, contrary to the provisions of the Memorandum and Articles of Association of Bank PHB, and in a manner grossly oppressive and/or unfairly prejudicial to the shareholders and/or members of the bank, particularly the petitioners and their interests in the bank, the 2nd to 13th respondents under the active direction of the CBN and /or its governor, have sought and/or are seeking to convert the said N70 billion into an equity shareholding in the bank in favour of the CBN and/or its nominees.The shareholders, who sued for themselves and on behalf of other affected shareholders of Bank PHB, through their counsel, Onyebuchi Aniakor, therefore, prayed for an order of court compelling the CBN and /or its governor jointly and /or severally to render account of their dealings in the affairs of the bank whether by themselves, personally or through their agents, servants, officials and/or privies.Notwithstanding the petition, Intercontinental Bank Plc and Access Bank Plc had gone ahead by signing an MoU on March 29, for business combination, which they said was to pave way for improved operational relationships between the two financial institutions.The action,, however infuriated the shareholders of Intercontinental Bank, compelling 10 of them, to urged a Federal High Court, Lagos to nullify the pact.The shareholders, in the suit, that has the Central Bank of Nigeria (CBN), among others, as co-defendants, pointed out that the MoU was signed, despite a pending suit challenging the sale of Intercontinental Bank.In a motion on notice brought pursuant to section 6(6)(a) of the constitution of the Federal Republic of Nigeria, 1999, order 26 rule 1 of the Federal High Court (civil procedure) Rules, 2009, the plaintiffs also sought an order vacating or declaring the purported MoU, itself as claimed in a joint press statement dated March 28, 2011, in the name and/or behalf of the first and 16th respondents and published in a paid advertorial in the national dailies, particularly The Guardian Newspapers of Monday, the March 28, 2011, during the pendency of this suit for being invalid, null and void and of no effect whatsoever.The motion, which was supported by a seven-paragraph affidavit, and filed by counsel to the shareholders, Onyebuchi Aniakor, was predicated on the ground that the court had on March 3, 2011, after hearing the petitioners on their application by way of motion exparte for orders, inter alia, of interim injunction filed in this suit, ordered, inter alia, that the respondents be put on notice in respect thereof and adjourned the same to the 11th March, 2011.The petitioners averred that the respondents herein were duly served with the originating and other processes in this suit inclusive of the enrolled order of court aforesaid and the petitioners motion on notice for orders, inter alia, of interlocutory injunction.According to the shareholders, when this matter came up, on March 18, 2011, the court, with the concurrence of the parties and/or their counsel, adjourned the same to April 6, 2011. for the hearing of all pending applications.They also averred that notwithstanding the foregoing, however; and, in a clear attempt to overreach the petitioners and their claims in this suit and/or the prayers sought in the petitioners said pending application for orders, inter alia, of interlocutory injunction of which due notice has been given, the respondents proceeded to purport to have signed and/or caused to be signed a Memorandum of Understanding on the 28th March, 2011 between the first respondent herein, Intercontinental Bank PLC and the 16th respondent herein, Access Bank Plc allegedly for purpose of business combination of both institutions as claimed in a joint press statement dated the 28th March, 2011 in the name and/or behalf of the first and the 16th Respondents and published in a paid advertorial in the national dailies particularly The Guardian Newspaper of Monday, the 28th March, 2011.In an affidavit in support of the motion, deposed to by the first plaintiff, Okoli Frank Jovita Emeka, the shareholders averred that the conduct of the respondents were calculated to overreach the petitioners suit; and to subject the court and the judicial process to ridicule and that the court is vested with the powers to protect its dignity and/or the judicial process from abuse.The shareholders want the court to determine; whether the purported signing of a Memorandum of Understanding between the first respondent herein, Intercontinental Bank Plc and the 16th respondent herein, Access Bank Plc allegedly for the purpose of business combination of both institutionsor at all during the pendency of this Suit and the claims thereon; and in the face of the Petitioners pending application for Orders, inter alia, of interlocutory injunction is not invalid by reason thereof and ought to be set aside, accordingly.But the CBN had in his objection questioned the jurisdiction of the court to entertain the suit and urged the court to strike out or dismiss the suit on the ground that the suit is statute bar and that it was not properly commenced.In the objection filed by CBNs counsel, Kola Awodein (SAN), the apex bank argued that the applicant have no right of action against the bank and therefore the suit amounts to a gross abuse of court process.Also Intercontinental bank and Its Directors had through their counsel, Dr Khrushchev Ekwueme questioned the jurisdiction of the court to hear the suit on the ground that the petitioners lack the locus to initiate the suit.
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