Court re-opens Savannah Bank, 7 yrs after
Written by Ise-Oluwa Ige
Friday, February 6, 2009






*Grants 18 months to re-capitalise

ABUJA—RENEWED hope came the way of over 85,000 bank shareholders and more than 750,000 depositors as the Court of Appeal sitting in Abuja yesterday ordered the Central Bank (CBN) to restore, with immediate effect, the operational licence of Savannah Bank of Nigeria (SBN).

The order followed its findings that the bank was shut in bad faith, with its about 3,000-strong workforce abruptly thrown into the unemployment market.

In a unanimous judgment that lasted about two hours by a three-member panel of the Abuja division of the Court of Appeal, the court tongue-lashed both the CBN and the Nigeria Deposit Insurance Corporation (NDIC) for unjustifiably revoking the licence of the bank. The court awarded a total N100 million damages against the financial regulatory bodies.

Besides, the appellate court yesterday gave Savannah Bank 18 months to recapitalise even as it ordered the two regulatory financial institutions in the country (CBN and NDIC) not to take over, seal up, or use men of the Nigeria Police Force to obstruct the bank from operating nationwide.

By implication, respite has come the way of the bank’s 85,000 shareholders, and over 750,000 depositors who lost access to their funds more than seven years ago and over 3,000 workers thrown into the unemployment market and their numerous dependents.

Nwobodo's counsel hails judgement

Counsel to Chief Jim Nwobodo, majority shareholder in Savannah Bank, Mr Oluwemimo Ogunde yesterday expressed delight at the court’s verdict, saying although the road was long and tortuous but that the most important thing was that justice had come eventually.

His words: “On the strength of this judgment, we will approach the Central Bank of Nigeria (CBN) to give us the state of affairs of the bank, tell us the amount of money found in the vault and the furniture for proper handover to the Board.

“When we know how much we have, then we can be talking about recapitalization.

“We expect the CBN and the NDIC to give us our accounts in order to settle our liabilities. We want to satisfy our customers. No one must lose out, particularly those who have committed their monies.

“Above all, we are grateful to God. We are grateful to our fearless judiciary because it takes courage to deliver this type of judgment. We want to thank all our customers and depositors and shareholders who have stood by us.

“You would recall that sometime ago, Savannah Bank was de-listed from the Stock Market and we now hope that it will be re-listed.

“Hopefully, we will re-open soon to the public,” he said adding that though N100million damages was awarded but that it could not pay for the damage that had been done to the bank, its depositors, shareholders and others in seven years.  

Cautious optimism

However, sources close to Chief Nwobodo yesterday said that events are still being watched as they unfold. One of his close aides who declined to be named said that while the judgement was both welcome and a vindication of his principal, the attitude is to wait and see.

“We are still watching events as they unfold. You know, the authorities might appeal this judgement, which in practical terms is a stay of execution. So we are watching events, though the judgement is welcome and a vindication of the stance that the bank was neither failed nor distressed at the time its operating license was withdrawn.”

The CBN had on February 17, 2002 ordered the closure of the Savannah Bank. The decision to close it down then was announced in Lagos at a media briefing addressed by the CBN’s Director of Banking Supervision, Mr. Ignatius Imala.

The CBN had cited the bank’s alleged poor state of health, mismanagement and other information that it had allegedly given to the regulatory authorities as reasons for its closure.

But Savannah Bank had denied the allegation that it was ailing at the time it was closed down and had imputed political motive as reason for the closure.

Savannah Bank's N100bn lawsuit

The bank itself which protested the closure also slammed a N100 billion suit against the two financial sector regulators, CBN and NDIC, and the Inspector-General of Police.

CBN was sued by Savannah Bank over seizure of its operational licence, NDIC was joined because of its proposed plan to sell the assets of the bank to settle the bank’s depositors while IGP was sued because of his role in ensuring that all the banking premises of the bank nationwide were sealed.

The case was filed by the late former Attorney-General of the Federation and Minister of Justice, Chief Clement Akpamgbo (SAN) at the registry of the Federal high court sitting in Abuja.

But when he fell sick, one of his men and now a member of the inner bar, Chief Chris Uche (SAN) took over the prosecution of the case.

Uche handled the case for a long time before the two chambers of Joe Gyari Gadzama (SAN) and Oluwemimo Ogunde took over the prosecution of the case till judgment yesterday.

It would also be recalled that when the matter was filed fresh, Justice Okechukwu Okeke was assigned to hear the matter but he could not go far before he was transferred from Abuja and same matter was re-assigned to Justice Stephen Jonah Adah who later gave judgment against Savannah Bank.

The verdict of the trial court was taken on appeal and the Court of Appeal gave judgment against both the CBN and the NDIC. In the suit filed by Savannah Bank, it had maintained that its closure was done with evil intention.

Said the bank: “the plaintiffs 85,000 shareholders have been dispossessed, while over 750,000 depositors have lost their funds. Over 3,000 workers have been thrown into unemployment, despair and anguish with same fate on their numerous dependents.

“The forced, unexpected and unjustified closure has caused 14 known direct deaths of the bank’s customers whose only crime was to lodge their hard earned money in a bank the defendants (and whoever they represent) disliked its present ownership structure and decided to descend on without considering the impact and consequence on innocent customers.

“The defendants have caused the plaintiff to lose several hundred of thousands of customers, old, new and prospective as a result of the acts of the defendants in trying to kill the bank.

“In the course of chasing out the plaintiffs, staff and security from the bank, the defendants and their agents invaded the vaults of the plaintiffs and looted over N500 million cash from the vaults which they have failed to account for,” added Savannah bank.

The bank had consequently asked the court to award in its favour a sum of N100 billion as special, exemplary and general damages for willful disruption of the plaintiff’s banking business and loss of business and profits throughout Nigeria from February 18, 2002 till judgment.

Savannah Bank had also asked for an order of the court to set aside the order of revocation of its banking licence, direct the CBN to re-issue it the licence or restore the revoked one alternatively even as it wanted the court to compel them to open its business premises nationwide and stop them from further sealing it off, all of which were granted yesterday.

Depositors, shareholders react

One of the shareholders of the bank, Alhaji Gbadebo Olatokubo who also welcomed the court’s judgment said that great hurdles lie ahead of the bank.

“I am seriously apprehensive about how the bank is going to operate because banking has moved from where Savannah Bank stopped.

“Challenges in terms of information technology, depositors’ harmonization, recruitment of new hands and composition of the management and board and more importantly getting the confidence of Nigerians are some of the problems staring the bank in the face,” Olatokunbo said.

Olatokunbo who was a former Publicity Secretary of the Nigeria Shareholders Solidarity Association (NSSA) said that the court’s decision has clearly shown that the “CBN is not the God it plays but an institution supported and driven by public funds.”

Mr Sam Ogbemudje, a lawyer said the judgment had further vindicated the judiciary as the last hope of the common man.

Ogbemudje said that the import of the ruling which he described as a warning signal to the political class is that people in authority should let their actions be guided by the rule of law.

“Democracy is the foundation of sustainable economic growth and people in authority must learn to appreciate that they cannot always do what they want without recourse to the rule of law,’’ Ogbemudje said.

The Managing Director of H,J. Trust and Investment Ltd, Mr Harrison Owoh described the court’s judgment as a welcome development, giving the circumstances that led to the closure of Savannah Bank Plc.

“The Court of Appeal decision to me remains a decisive judgment that has corrected the political undertone which tainted the revocation of the operating license of Savannah.

“Most Nigerians, at the time the bank’s license was revoked knew that Savannah was buoyant and solvent more than some of the banks that were given the opportunity to recapitalise,” Owoh said.

He also urged the owners of the bank to make effective use of the opportunity offered by the court pronouncement by settling their internal differences.

http://odili.net/news/source/2009/feb/6/317.html

Lol, who will invest his money in such bank afterwards?

Kudo's to jim nwobodo.
he followed CBN and NDIC with vigour. other shareholders may have abandoned everything about the bank and moved on.

congratulations again jimmy.

meanwhile, what happens to those who lost their money? any chance they'll get part of the money?

Ope o! My great gran papa can get his job back!

oya jim - go get your 25 billion naira and your mandatory 100+ branches across the nation
good luck - you'll need it

So its true? I saw Job adverts from Savannah Bank in the newspaper today. Wow! Dis is a true example of perseverance and uprightness.

I hope Olu saraki follows his own up too. I mean Societe Generale.

its about getting the licence where do u think they will get the N25bn in the midst of this financial crisis,
even if they go public to raise who do u think will buy shares now?

Nigeria's legal system sure can be slow. 7 years?

hmm 5000 new jobs in the next 18months hopefully

They have A LOT of work to do in terms of existing competition though.

Nigeria's legal system sure can be slow. 7 years?

They will frustrate you out of the system. I think the best thing for them to do is to liquidate their assets and settle debtors. If they want to float another bank, they can do so with another name. Nigeria is not America where some dumb nuts will give them a try.

Imagine if Citigroup or Wachovia are Nigerian banks, the fact they hinted their money problems is enough for people to flood their gates the next morning asking for their savings. If you look at it very well, will you blame Nigerians for behaving that way?

i lost my life savings at savanah bank. I went to the bank on Feb 13 to get some money for Val day and went back on feb 15th only to discover that it was under lock and key. Their licence alone is worth N25billion. kudos to their lawyers.

i lost my life savings at savanah bank. I went to the bank on Feb 13 to get some money for Val day and went back on feb 15th only to discover that it was under lock and key. Their licence alone is worth N25billion. kudos to their lawyers.

How much are we talking about here?

dede jimmy, how about people wey lose their money?

dede jimmy, how about people wey lose their money?

Where were they when I was pursuing this case in court?

earTHMama:

Where were they when I was pursuing this case in court?

customers have no business with the court. their business or custom was with the bank.

customers have no business with the court. their business or custom was with the bank.

Well dem don use your money on their mistresses and if you go near them with any form of protest, na EFCC go carry you in.

For Bleep's sake, I thought we had put a final nail in the coffin of that bank. I guess, the dead can always arise.

For Bleep's sake, I thought we had put a final nail in the coffin of that bank. I guess, the dead can always arise

I'm still wondering on how they will resuscitate the bank and hope for people to lodge their money in there. Unless they want to take their business to Cote d'ivoire.

i for one will never put a dime in savanah

i will definitely do business with that bank.
Dede Jimmy, has to settle me even though the money lost na tashiri.

Bleeeep

some months to go,

Happy for them, but what would they do to make people wanna invest with them?

more like where would they get the money from?

Nigerian banks always follow the same lazy model, so don't expect them to do anything different
from what the rest are doing.  .   . perhaps bombard people with promos and raffle tickets 

Dis Guy:

more like where would they get the money from?

Nigerian banks always follow the same lazy model, so don't expect them to do anything different
from what the rest are doing.  .   . perhaps bombard people with promos and raffle tickets 

Till they are listed back on the Market, will be extra hard for them to generate funds . . . .except some people blv in them and wont mind to drop their personal funds

OLD NEWS.functioning banks are struggling to survive not to talk of reviving dead and buried one. abegi.

ode remo:

OLD NEWS.functioning banks are struggling to survive not to talk of reviving dead and buried one. abegi.

If they can do what the struggling ones no fit do and be better, they might do better, but the problem will be how to enter into the market.

@phemmy, can you tell me how many old dis function bank ever came back with full operation, starting frm AGBONMAGBE BANK TO NATIONA L BANK , BCC .etc
brand guru will tell you how diff. it is.

Savannah, has an international partner called IRS. Those guys are still ready to try once more!!!


When will savannah start paying us customers who lost our hard earned money?