Sunday Ehigiator
Wema Bank Plc has dismissed allegations surrounding the sale of Banana Island properties allegedly linked to the defunct Gulf Bank Plc, describing recent media reports on the matter as, “false, misleading, and wholly unsubstantiated.”
In a statement, Wema said the claims were “malicious” and aimed at distorting facts relating to its recovery of funds owed by Gulf Bank.
According to the bank, the dispute originated from an inter-bank placement of N4.6 billion made to Gulf Bank in 2002. Wema said the exposure was reduced to about N1.2 billion by August 2004 before the outstanding obligation became delinquent.
The bank explained that investigations by the Economic and Financial Crimes Commission (EFCC) later revealed that the funds had allegedly been diverted and used to acquire properties in Banana Island, Lagos, through two companies; Bacad Finance & Investment Company Limited, now known as Supra Commercial Trust Limited, and Euston Wenberg Eng Limited.
Wema stressed that the companies were distinct legal entities and not the same as Gulf Bank Plc, adding that they were not under the supervision of the Nigeria Deposit Insurance Corporation (NDIC).
The bank further stated that following EFCC findings, the two companies voluntarily relinquished their proprietary interests in the Banana Island properties in settlement of Gulf Bank’s indebtedness to Wema Bank. It described the move as part of its lawful recovery efforts.
Wema also claimed that the NDIC formally acknowledged Gulf Bank’s indebtedness to the bank in letters dated September 26, 2007, and June 10, 2009, addressed respectively to the Federal Land Registry and Wema Bank Plc.
According to the statement, the NDIC subsequently paid the shortfall outstanding after the sale of the properties, a development Wema said demonstrated that the corporation was aware of and participated in the transaction.
The bank maintained that, based on the voluntary relinquishment of the properties, NDIC’s admission of indebtedness, and payment of the shortfall, the corporation could not “in good faith contest the relinquishment of those interests or the appropriateness of Wema Bank’s recovery efforts.”
Wema acknowledged that NDIC had commenced two separate suits against the bank at the Federal High Court in Lagos in its capacity as liquidator of Gulf Bank Plc. However, it said the matters were now before the court and therefore sub judice.
The bank added that it would continue to contest the suits through, “all legal and legitimate means” while reaffirming its commitment to corporate governance, transparency, and regulatory compliance.