The Nigeria Deposit Insurance Corporation (NDIC), acting as liquidator of the defunct Gulf Bank Plc, has instituted two separate actions at the Federal High Court in Lagos against Wema Bank Plc. The combined claims amount to approximately N125,384,535,500.00 (One Hundred and Twenty-Five Billion, Three Hundred and Eighty-Four Million, Five Hundred and Thirty-Five Thousand, Five Hundred Naira), arising from two distinct sets of disputed high-value properties in Banana Island, Lagos, alongside an alleged improper cash transaction of N401 million.
Both suits were filed under the Failed Banks (Recovery of Debts and Financial Malpractices in Banks) Act and form part of NDIC’s long-running efforts to recover and liquidate outstanding assets of the defunct Gulf Bank Plc nearly two decades after its collapse.
The two actions, though related, concern distinct sets of six properties each, acquired through different shell companies allegedly used by the defunct bank.
The first suit concerns six properties in Banana Island purchased in the name of Euston Wenberg Engineering Company Limited, described in the pleadings as a shell company used by Gulf Bank Plc. These plots situate in Zones J, K, L and P, have a combined area of approximately 13,794.145 square metres. At the prevailing market rate of N4,500,000.00 per square metre, NDIC values these properties at N62,073,652,500.00 (Sixty-Two Billion, Seventy-Three Million, Six Hundred and Fifty-Two Thousand, Five Hundred Naira).
The second suit concerns a separate set of six properties in Banana Island acquired through Bacad Finance and Investment Limited (later renamed Supra Commercials Limited), another entity in which the defunct bank held over 80% shareholding. These plots have a combined area of approximately 13,979.974 square metres, valued at N62,909,883,000.00 (Sixty-Two Billion, Nine Hundred and Nine Million, Eight Hundred and Eighty-Three Thousand Naira) at the same per-square-metre rate. In addition, the second suit claims recovery of N401,000,000.00 (Four Hundred and One Million Naira) allegedly collected by Wema Bank from the NDIC’s agent bank, United Bank for Africa (UBA), in September 2009.
The Governor of the Central Bank of Nigeria revoked Gulf Bank Plc’s banking licence by notice published in the Official Gazette of the Federal Republic of Nigeria (Volume 93, Number 3, Government Notice No. 7) dated 16 January 2006, and the Federal High Court, Lagos Division, subsequently made a winding-up order on 27 November 2006, appointing NDIC as liquidator. On the basis of those instruments, the Corporation maintains it is legally mandated to trace, recover, and liquidate all outstanding assets of the defunct bank for the benefit of depositors and creditors.
In the first suit, NDIC alleges that Gulf Bank acquired six Banana Island plots between 1998 and 2003 using Euston Wenberg Engineering Company Limited as a vehicle. The internal records of the defunct bank reportedly treated the acquisition as a loan account, an arrangement NDIC contends shows the assets remain beneficially owned by Gulf Bank Plc.
NDIC further alleges that Wema Bank took custody of these properties purportedly to secure an interbank deposit of N771.79 million, but that a joint CBN/NDIC special examination conducted in September 2005 found no record in Gulf Bank’s books confirming that any such deposit existed. The examination report, dated 30 September 2005, found the defunct bank’s explanations unsatisfactory and no supporting documentation was subsequently produced.
According to NDIC, Wema Bank later presented two managers’ cheques from Access Bank and Intercontinental Bank, both dated in September 2005 totaling N250 million in favour of Euston Wenberg Engineering Limited, which NDIC framed as instruments for a purchase rather than a recovery of a deposit. NDIC contends that the purported sale at N250 million was commercially implausible, given that a single property in Banana Island at that time was worth in excess of N500 million.
In the second suit, NDIC alleges that Gulf Bank injected N20 million into Bacad Finance and Investment Limited in 2001 to increase its share capital, and later invested a further N60 million in the company in 2003. The defunct bank ultimately held over 80% of Bacad Finance’s shares and used the entity to acquire a second set of six Banana Island plots. The pleadings record that the defunct bank intended to develop the properties as a luxury residential estate of 72 flats, to be called Bacad Estate, in partnership with Shelter Afrique.
NDIC alleges that Wema Bank, without any valid mortgage, court order, or proprietary interest, took custody of these properties and later claimed to have sold them for N524 million by way of managers’ cheques dated 2006 and 2007. NDIC describes this claimed sale price as grossly implausible given that each property was worth over N4 billion by that period.
Separately, NDIC states that in June 2009 it wrote to Wema Bank approving payment of N1,635,616.44 as the full outstanding deposit due to the bank as at 16 January 2006, the date Gulf Bank went into liquidation. Notwithstanding that communication, NDIC alleges that in September 2009 Wema Bank collected N401 million from UBA, NDIC’s agent bank, without lawful justification, and that the Corporation has no record showing Wema Bank was owed any sum beyond the approved N1.635 million.
Both suits are supported by investigations conducted by senior legal practitioners and retired security operatives, including Dada Awosika SAN of D.A. Awosika & Partners LLP, Pekun Sowole Esq., retired Deputy Inspector-General of Police Abiodun Alabi, and J.I. Okolonji Esq., the latter a retired Deputy Director who headed NDIC’s Criminal Investigation Unit. NDIC has also filed a petition with the Economic and Financial Crimes Commission (EFCC) for investigation and possible prosecution.
In both actions, NDIC invokes the special jurisdiction conferred by the Failed Banks Act, which the pleadings describe as excluding the application of limitation laws, permitting the lifting of the corporate veil, and authorising summary remedies including committal to prison for non-compliance.
In both suits, NDIC is seeking declarations that any purported sale of the properties was illegal, null, and void; that Wema Bank had no valid interest in any of the properties; and that NDIC, as liquidator, is entitled to their current full value. The primary order sought in each suit is payment of the assessed value of the properties within 30 days of judgment. In the alternative, NDIC seeks the return of all original certificates of occupancy. In the second suit, an additional order is sought for repayment of the N401 million. Both suits include applications for committal of the bank’s Managing Director and Executive Directors in the event of non-compliance.
Wema Bank, through its counsel Dr. Oladapo Olanipekun SAN, Mr Kehinde Ogunwunmiju SAN and Mr Tunde Afe-Babalola SAN have filed a preliminary objection challenging the court’s jurisdiction. The bank relies on the Failed Banks Act, the Companies and Allied Matters Act (CAMA) 2020, the Limitation Law of Lagos State, and Sections 6(6) and 251(1) of the 1999 Constitution.
Wema Bank argues that NDIC’s claims do not arise from any loan, credit facility, guarantee or banking transaction between the parties, as required under the Failed Banks Act, and that the bank was never a customer of Gulf Bank Plc in respect of any credit facility. The bank further contends that the suits disclose no debtor-creditor relationship and that NDIC lacks locus standi because the disputed properties were allegedly owned by Bacad Finance and Investment Limited (now Supra Commercials Limited), a separate legal entity. According to Wema Bank, the matter is fundamentally one of property ownership rather than banking debt recovery, placing it outside the Federal High Court’s jurisdiction under Section 251(1) of the Constitution.
The bank also argues that any cause of action, if it existed at all, arose between 2006 and 2007 and is now statute-barred under the Limitation Law of Lagos State, and accuses NDIC of abusing court process by attempting to circumvent limitation laws with a stale claim. Wema Bank is asking the court to strike out or dismiss both suits.
The Federal High Court is expected to determine, among other questions, whether Wema Bank had any legal or equitable interest in either set of Banana Island properties; whether any valid mortgage or court order existed to justify disposal of the assets; whether the Failed Banks Act excludes limitation periods and, if so, whether it applies on these facts; whether NDIC can lawfully recover assets approximately 20 years after Gulf Bank’s collapse; and whether the alleged N401 million collection from UBA was properly authorised under banking law. The matters have been adjourned to 25th June 2026 for further proceedings.