NDIC Launches Massive Legal Fight Over Alleged ₦125.38bn Banana Island Holdings Linked To Wema Bank

Nigeria Deposit Insurance Corporation (NDIC) has instituted two separate lawsuits against Wema Bank at the Federal High Court in Lagos over assets allegedly linked to the defunct Gulf Bank Plc, with the disputed properties and funds valued at over ₦125.38 billion....KINDLY READ THE FULL STORY HERE▶

The legal actions, filed under the Failed Banks (Recovery of Debts and Financial Malpractices in Banks) Act, are part of NDIC’s continued efforts to recover and liquidate assets tied to the collapsed bank nearly 20 years after its operating licence was withdrawn.

At the centre of the dispute are 12 prime properties located in Banana Island as well as an alleged unauthorised payment of ₦401 million.

In the first suit, the NDIC alleged that six plots situated across Zones J, K, L, and P of Banana Island were acquired between 1998 and 2003 through Euston Wenberg Engineering Company Limited, which the corporation described as a front company allegedly used by Gulf Bank.

The properties, covering approximately 13,794.145 square metres, were valued by the NDIC at about ₦62.07 billion using a market estimate of ₦4.5 million per square metre.

According to the corporation, the properties later came under Wema Bank’s control as collateral tied to an alleged interbank deposit worth ₦771.79 million. However, NDIC claimed that a joint examination conducted by the Central Bank of Nigeria (CBN) and NDIC in September 2005 found no evidence of such a deposit in Gulf Bank’s records.

The corporation further alleged that Wema Bank later presented two managers’ cheques issued by Access Bank and Intercontinental Bank in September 2005 totalling ₦250 million in favour of Euston Wenberg Engineering Limited.

NDIC argued that the transaction appeared more like a property purchase than a debt recovery exercise and described the amount involved as commercially unrealistic, noting that even a single Banana Island property at the time was reportedly valued above ₦500 million.

The second lawsuit concerns another six Banana Island properties allegedly acquired through Bacad Finance and Investment Limited, now known as Supra Commercials Limited.

NDIC claimed Gulf Bank invested ₦20 million into the company in 2001 and an additional ₦60 million in 2003, eventually acquiring over 80 per cent ownership of the firm.

Court documents stated that the properties were intended for a luxury 72-flat housing development known as Bacad Estate in collaboration with Shelter Afrique.

The corporation alleged that Wema Bank later assumed control of the plots without any valid mortgage arrangement, court order, or proprietary rights before allegedly selling them for ₦524 million through managers’ cheques issued between 2006 and 2007.

NDIC described the sale price as grossly undervalued, claiming each property was worth more than ₦4 billion at the time.

The corporation is also seeking recovery of ₦401 million allegedly received by Wema Bank from United Bank for Africa (UBA) in September 2009.

According to NDIC, it had previously approved payment of ₦1,635,616.44 as the total outstanding deposit owed to Wema Bank as of January 16, 2006, insisting that no additional payment should have been made afterward.

In both suits, the NDIC is asking the court to declare the disputed property transactions illegal, null, and void, and to compel Wema Bank to either pay the current market value of the properties within 30 days of judgment or return the original certificates of occupancy.

The second suit also seeks repayment of the ₦401 million allegedly collected unlawfully.

Additionally, applications have reportedly been filed seeking possible committal proceedings against the bank’s Managing Director and Executive Directors in the event of non-compliance with any future court orders.

However, Wema Bank has challenged the suits by filing a preliminary objection questioning the court’s jurisdiction.

The bank argued that the claims do not relate to loans, credit facilities, or standard banking transactions as required under the Failed Banks Act and maintained that no debtor-creditor relationship exists between both parties.

Wema Bank also contended that the Bacad Finance properties belong to a separate legal entity and further argued that the claims are statute-barred under the Limitation Law of Lagos State.

The Federal High Court is expected to determine jurisdictional issues and other major arguments when the matter resumes on June 25, 2026.