CBN's Actions Against Union Bank Ruled as Bad Faith

The Federal High Court of Nigeria issued a landmark judgment against the Central Bank of Nigeria (CBN) regarding Union Bank, declaring the CBN's actions as bad faith. The court nullified the CBN's dismissal of the bank's former board and ordered the immediate restoration of the board, along with an award of 190 million naira to shareholders.

The CBN had intervened in January 2024, citing regulatory non-compliance and financial instability as reasons for dissolving the board. However, the court found that the CBN's actions violated the directors' rights to a fair hearing and were not legally justified.

The judgment highlighted that the CBN's regulatory powers must be exercised within legal confines, and the court ruled that the CBN's claims of financial distress were not sufficient grounds for its actions. Following the ruling, the CBN filed an appeal and sought to stay the execution of the judgment.