Fidelity dismisses bankruptcy claim amidst judgement damages

Fidelity Bank PLC has dismissed a claim of being bankrupt owing to an accusation of defaulting to pay N225 billion damages to a Nigerian firm. The report titled: “Exclusive: Fidelity faces bankruptcy as Supreme Court orders banking giant to pay N225 billion damages to Nigerian firm” published by Peoples Gazette touted the bank as shelving […]

Fidelity Bank PLC has dismissed a claim of being bankrupt owing to an accusation of defaulting to pay N225 billion damages to a Nigerian firm.

The report titled: “Exclusive: Fidelity faces bankruptcy as Supreme Court orders banking giant to pay N225 billion damages to Nigerian firm” published by Peoples Gazette touted the bank as shelving off a Supreme Court judgement on a years-long property dispute between the bank, G.Cappa and Sagecom Concepts Limited and the bank.

According to the report, Supreme Court justices on April 11, 2025, gave a unanimous decision over a pair of loans obtained by engineering giant, G. Cappa Plc from FSB International Bank in the early 2000s.

The loans, recorded as $3 million and N100 million at the time, were executed before Fidelity Bank bought FSB International and its liabilities as part of the banking sector consolidation in 2005.

• NIGERIA DAILY : Can There Be Mandatory Voting In A Democracy?
• Refinery: If we understood magnitude, we might not have attempted it – Dangote

The cumulative facility was issued at a prohibitive interest per annum, and Fidelity began seizing G. Cappa’s assets in Ikoyi and Ibadan that had been used to secure the deal when the company allegedly defaulted in 2005. G. Cappa sued at the time, and a federal judge in Lagos ordered Fidelity to desist from its aggressive depletion of G. Cappa’s assets, court documents said as quoted by Peoples Gazette.

However, the bank in a statement signed by Divisional Head, Brand & Communications, Meksley Nwagboh clarified its position on the judgement, saying it was inherited from defunct FSB International Bank.

The statement explained that the defunct FSB International Bank granted a credit facility to G. Cappa Plc in 2002 for the sum of USD3 million, but the latter defaulted in its repayment plan.

It stressed that in an attempt to prevent the bank from selling the mortgaged property to repay the loan, the firm commenced an action against FSB at the Federal High Court, Lagos seeking inter-alia to restrain the bank from selling the property.

It added that the Federal High Court in its judgment ruled that the bank as legal mortgagor rightfully sold the leased interest in the property to Sagecom in 2011.

It stressed that the court however declined to order vacant possession of the property and directed the issue of vacant possession to the Lagos State High Court, saying that for that period of time, G. Cappa remained in possession of the property and kept collecting rents therefrom.

According to the statement, Sagecom then instituted an action against the bank and G. Cappa at the Lagos State High Court in 2011 seeking damages against the bank for breach of contract and for possession of the property.

It highlighted that Sagecom’s claim against the bank was essentially for liquidated damages calculated as rentals on the several component apartments in the property plus interest on the same over different time frames.

It stressed that in 2018, the Lagos High Court awarded judgment in favour of Sagemcom against G. Cappa and the bank, which judgment was challenged at the Supreme Court.

It said the bank was convinced that by remaining in possession of the property and continuing to collect rents therefrom, G. Cappa orchestrated all the losses suffered by Sagecom.

“However, having exhausted the appeal process, the bank is willing to settle the obligation,” the statement reads.

It added that the bank has approached the court to clear significant ambiguities in the judgment resulting in difficulties in calculating the actual financial liability to the G.Cappa and the bank, which is about N14billion from our computation based on the exchange rate as of 2005 when the incident and cause of action arose.

“Even if the 2018 exchange rate supported by the Supreme Court is applied, the judgment debt will just be under N30.7 billion payable by G.Cappa Plc (who delayed delivery of possession of the apartments from 2005 till June 2018 when possession was eventually delivered) with contribution from the bank.

“Consequently, the bank has applied to the court for a clarification and inquiry into the proper interpretation of the judgment and the computation of the actual quantum properly and lawfully payable by G.Cappa and the bank,” the statement reads.

It said the court ordered Sagemcom to maintain status quo pending the determination of pending motions and restrained it and all persons from publishing any material in the media as the matter is still pending in court.

“The implication of this order is that the instant publication by People Gazette and any other media platform or persons, contain false information and is wrongful, unlawful and constitute a contempt of court.

“Meanwhile, the bank is taking all necessary steps to apprehend and prosecute any person or platform directly or indirectly responsible for this wicked, malicious and sponsored publication aimed at embarrassing the bank and causing panic to its stakeholders,” the statement reads.

Meanwhile The Central Bank of Nigeria (CBN) has dispeled the growing concerns fueled by recent media reports and social media speculation regarding the operations of a regulated financial institution, affirming that the country’s banking sector remains stable, secure, and resilient.

In an official statement released by Mrs. Hakama Sidi Ali, Acting Director of Corporate Communications, the apex bank emphasized that all deposit-taking institutions under its supervision, including the one referenced in the circulating reports, are subject to strict regulatory oversight and continue to meet the required safety standards.

“The Nigerian banking sector remains resilient, safe, and sound,” the CBN declared, urging the public to disregard unverified and sensational claims and to rely exclusively on official communications from the Bank.

Tthe CBN reiterated its commitment to monitoring financial institutions through robust risk-based supervision frameworks and early warning systems. These mechanisms, the Bank noted, are designed to quickly detect and address any potential issues before they escalate.

“We continue to maintain solid structures that guarantee the safety of depositors’ funds and the stability of the financial system,” the statement read.

Assuring depositors and stakeholders, the CBN stressed that it will remain steadfast in its mandate to protect the financial system and enhance public confidence in the banking sector. The Bank further pledged to continue evolving its strategies to safeguard the financial interests of Nigerians.

The reassurance comes as part of the CBN’s broader effort to combat misinformation and maintain public trust in the face of unfounded speculation.