The Central Bank of Nigeria (CBN) and the Nigeria Deposit Insurance coverage Company (NDIC) have requested the Federal Excessive Courtroom in Abuja to say no jurisdiction in a go well with filed by Aso Financial savings & Loans Plc and Union Houses Financial savings & Loans Plc difficult the revocation of their working licences.
That is in keeping with proceedings on the Federal Excessive Courtroom on Monday, the place each regulators raised preliminary objections earlier than Justice Emeka Nwite.
The authorized dispute follows the CBN’s latest withdrawal of the mortgage banks’ licences, a transfer that has triggered liquidation steps by the NDIC and raised considerations over depositor safety and regulatory due course of.
What the regulators are saying
Counsel to the CBN, Onyeka Ezeah, and NDIC’s lawyer, Abubakar Shehu, advised the court docket that the go well with can not proceed as a result of the court docket lacks jurisdiction to entertain the matter.
- Ezeah described jurisdiction as “the lifeline of a case,” arguing that it should be resolved earlier than the court docket considers any substantive purposes.
- She cited a 2022 Supreme Courtroom resolution to help the place that jurisdictional points take priority.
- Shehu aligned with the CBN’s argument, insisting that the NDIC was appearing strictly inside its statutory mandate. He added that the company had already filed a preliminary objection and counter-affidavit, making the matter ripe for listening to.
What the mortgage banks are arguing
Counsel to Aso Financial savings and Union Houses, Joseph Silas, advised the court docket that the matter was scheduled for the defendants to “present trigger” why the court docket shouldn’t restrain them from taking additional motion.
He argued that though the CBN revoked the licences, the affected establishments are entitled underneath the legislation to a 30-day window to problem the choice, throughout which liquidation steps ought to be suspended.
In line with Silas, permitting the NDIC to proceed with liquidation might irreversibly prejudice the plaintiffs if the court docket later finds the CBN’s motion illegal.
He urged the court docket to order events to keep up the established order pending the dedication of the substantive go well with.
Nonetheless, each regulators opposed the request, sustaining that the NDIC is empowered to take over as soon as a monetary establishment’s licence is revoked, primarily to guard depositors who can not entry their funds.
Courtroom’s place and subsequent steps
Justice Nwite questioned whether or not it might be correct to grant any restraining order whereas preliminary objections difficult the court docket’s jurisdiction had been pending.
Describing jurisdiction as a threshold challenge, the decide stated he would keep away from embarking on an “train in futility” and adjourned the matter till January 21 for listening to of the defendants’ preliminary objections.
Background to the dispute
Aso Financial savings, Union Houses, and two shareholders filed the go well with after the CBN revoked the establishments’ licences in December 2025, citing failure to fulfill minimal capital necessities, inadequate belongings to cowl liabilities, undercapitalisation, and non-compliance with regulatory directives.
In court docket filings, the plaintiffs argued that the CBN didn’t observe due course of underneath the Banks and Different Monetary Establishments Act (BOFIA) 2020 and that the NDIC moved too rapidly to begin liquidation, thereby undermining their proper to problem the regulator’s resolution.
- The CBN had cited persistent regulatory infractions and deteriorating monetary situations on the two major mortgage banks as causes for its motion.
- It added that the choice was taken according to Part 12 of the Banks and Different Monetary Establishments Act (BOFIA) 2020 and Part 7.3 of the Revised Pointers for Mortgage Banks in Nigeria.
Be First to Comment