By Cynthia Alo

There is a particular genre of financial commentary that mistakes legal process for a factual verdict. A court delivers a first-instance ruling, procedural questions are raised, and before the ink is dry on the appeal filing, the narrative has already hardened: the regulator overreached, investor confidence is shattered, and Nigeria’s financial governance is on trial before the world.

Much of the commentary currently circulating about Union Bank of Nigeria belongs to that genre. It is not without merit on certain procedural questions.

But it is, at its core, incomplete — and incompleteness in financial journalism carries costs that run well beyond the column.

The Acquisition That Started Everything

In 2022, Titan Trust Bank Limited, then chaired by Mr Tunde Lemo, acquired approximately 94 per cent of Union Bank of Nigeria through two Dubai-registered entities: Luxis International DMCC, promoted by Mr Rahul Savara, and Mr. Cornelius Vink’s Magna International DMCC, both linked to the Tropical General Investments (TGI) Group.

The US$300 million transaction was financed predominantly through an Afreximbank facility.

The CBN’s policy is unambiguous: borrowed funds may not be used to acquire shares in a licensed financial institution. That principle exists because debt-funded acquisitions hollow out the very capital base they purport to build.

That is precisely what happened. A forensic audit found that the Afreximbank loan was ultimately reflected in Union Bank’s own books, with no hedging arrangements against naira depreciation. As the currency weakened, revaluation losses intensified, the capital adequacy ratio deteriorated into negative territory, non-performing loan exposure increased significantly, and a substantial capital shortfall emerged. Critically, as stated in the Bank’s own Notice of Appeal, a special examination was conducted, and its findings were formally presented to former Managing Director, Mudassir Amray and the board, then chaired by Farouk Gumel, who were confronted with the institution’s grave financial condition and continuing regulatory infractions.

The claim that the CBN acted without evidence before dissolving the board is, on the record, simply not accurate.

The Legal Picture

The CBN acted under Section 34 of BOFIA 2020 and Section 52 of the CBN Act 2007 — broad discretionary executive powers that do not require a special examination as a condition precedent.

The Federal High Court’s characterisation of those powers as quasi-judicial is itself among the central questions now on appeal. Both the CBN and Union Bank have filed formal appeals. Union Bank’s own Notice of Appeal, filed the day after judgment on thirteen grounds and argued by Olaniwun Ajayi LP, challenges the ruling on several fronts: that the respondents may never have had locus standi to sue in the first place, under the rule in Foss v. Harbottle; that the application was filed nearly two years after the January 2024 events, well outside the prescribed three-month limitation window; and that the CBN-supervised recapitalisation exercise, mandated under Section 9 of BOFIA, cannot constitute evidence of bad faith. These are not technicalities.

They are substantive questions of law that the Court of Appeal must now determine.

The Human Stakes and the Real Question

Behind the legal arguments sit approximately 7.8 million depositors and around 6,450 employees across 281 branches. Union Bank’s own affidavit describes it as a systemically important institution in a precarious financial situation, continuing to rely on CBN forbearance for its existence — a frank admission that validates, rather than undermines the case for intervention.

Meanwhile, critics argue the dispute damages investor confidence. The wider evidence does not support that conclusion. By April 2026, thirty-three Nigerian banks had raised N4.65 trillion under the CBN’s recapitalisation framework — over ten times the 2004 to 2005 consolidation figure.

The Nigerian Exchange All-Share Index rose approximately 29 per cent in the first quarter of 2026 alone. The market has read the CBN’s resolve as stability, not recklessness. Conflating this case with a systemic confidence crisis runs the risk of misleading the very international investors the commentary claims to be protecting.

The structural vulnerability at the centre of this dispute originates not with the regulator but with an acquisition financed with borrowed funds, loaded onto the acquired institution’s balance sheet, and left unhedged against exchange-rate risk. When the CBN stepped in, it was doing what central banks everywhere are expected to do.

When Union Bank’s own legally constituted board subsequently filed its own appeal, it was signalling what a properly constituted governance structure recognises as being in the institution’s best interests. Nigeria’s appellate courts — not the court of commentary — are the appropriate arena for resolution.

Union Bank of Nigeria is a 109-year-old institution serving nearly eight million depositors. It is not being dismantled. It is being stabilised under active regulatory supervision, with operations intact and depositors protected. In the language of institutional governance, that is called stewardship.
The commentary that mistakes it for anything else does the institution, its depositors, and Nigeria’s financial governance narrative a disservice that will outlast the headlines.
*Bala Rabiu, writes from Kano.

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•Warns policy failure hurting local oil investors

By Cynthia Alo

Vegetable and edible oil producers have raised alarm over the continued dominance of imported brands   despite the retention of items in   the Federal Government’s prohibition list under the 2026 fiscal policy measures.

According to the National Chairman of the Vegetable/Edible Oil Producers Association of Nigeria (VEOPAN), Okey Ikoro, the local market is still dominated by more than 100 imported oil brands, warning this threatens investments and discourages backward integration in the sector.

Speaking recently in an interview on Arise TV   Ikoro disclosed that members of the association recently intercepted three trailers transporting smuggled vegetable oil through the Badagry axis.

Ikoro, while reviewing the effect of the 2026 fiscal policy measures on the vegetable oil sector of the Nigerian economy, attributed   this development to failure of government agencies to enforce the ban on foreign brands of vegetable and edible oil brands. The agencies he said include the Nigeria Customs Service, National Agency for Food and Drug Administration and Control (NAFDAC), and the Standards Organisation of Nigeria,(SON).  

According to him, the initial ban failed by 85 percent after two years, even though it initially boosted investments as firms embarked on expansion projects following government protection of the industry.

He said: “The 2023 fiscal policy definitely placed vegetable oil under prohibition and a lot of milestones were gained because it was a long-time policy from 2023 to 2026. A lot of companies went into backward integration, huge companies like Okomu, Presco, PZ Wilmar , all of them went into major expansion because the policy gave protection to the industry.

“But two years later, entering 2024 and 2025, there was a total collapse of implementation on the side of the agencies that were supposed to monitor the fiscal policy, especially in the area of prohibition of items. We noticed that the markets were flooded with imported vegetable oil despite the fact that the item was under prohibition. If you go into the local market, you will see more than 100 brands of vegetable oil coming in from outside the country, in yellow jerry cans with funny labels. 

Nobody is monitoring. NAFDAC is not doing its job.

“This resulted in a lot of losses   and setbacks to the companies. Companies would have borrowed huge sums of money to put into their backward integration because oil palm is a long gestation investment. Before you can start getting returns, it takes a minimum of five years.

“These implementation problems do not give confidence to   investors to even come into the country, or for those of us that are locally investing, to continue to invest in this sector. The government should not only put policies in place; it should also monitor their implementation.

“Just a few days ago, members of the association arrested three long trailers coming in from Badagry, all carrying vegetable oil. NAFDAC came to the spot and saw that these are prohibited items. But our worry is,   where is Nigerian Customs on this?

“In all the markets, you see all sorts of brands coming in from all over Nigeria through Badagry and the northern borders, it was like a madhouse, actually, and it was like nobody is in charge of the borders anymore.”

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By Babajide Komolafe

Financial institutions including banks and insurance firms recorded a 8.5 per cent growth in real Gross Domestic Product, GDP to N1.9 trillion in the first quarter of 2026, Q1’26 from N1.78 trillion in Q1’25.

The National Bureau of Statistics, NBS disclosed this in its GDP report for Q1’26. The report showed that the   financial institutions sub-sector remained the dominant driver of activity, contributing N1.75 trillion in Q1 2026, up from N1.61 trillion in the corresponding period of 2025. This reflects an increase of about 8.4%, underscoring sustained expansion in banking operations, credit delivery, and financial intermediation.

The insurance sub-sector also recorded steady growth, rising to N180.95 billion in Q1 2026 from N164.58 billion in Q1 2025, representing an increase of approximately 9.9%. The performance signals gradual improvement in risk underwriting, premium generation, and broader market penetration.

The NBS in its report stated:   “The Finance and Insurance Sector consists of the two subsectors, Financial Institutions, and Insurance, in which the former accounted for 90.62% and the latter 9.38% of the sector, respectively in real terms in Q1 2026.  

“The sector grew at 46.91% in nominal terms (year-on-year), with the growth rate of Financial Institutions at 46.71% and 48.80% growth rate recorded for Insurance. The overall rate was higher than Q1 2025 by 25.89% points, and higher by 20.33% points than the preceding quarter.  

“The quarter-on quarter growth was 18.86%. The sector’s contribution to the nominal GDP was 3.83% in Q1 2026, higher than the 3.07% it represented a year previous, and higher than the contribution of 2.91% it made in the preceding quarter.  

“Growth in this sector in real terms totaled 8.54%, lower by 6.49% points from the rate recorded in the 2025 first quarter and higher by 0.24% points from the rate recorded in the preceding quarter.  

“Quarter-on-quarter, growth in real terms stood at 17.77%. The contribution of Finance and Insurance to real GDP totalled 3.76%, higher than the contribution of 3.60% recorded in the first quarter of 2025 by 0.16% points, and higher than 2.56% recorded in Q4 2025 by 1.20% points.”

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