Union Bank of Nigeria Plc has admitted it may be facing its worst nightmare yet, after a Nigerian court awarded N1.49trn against the bank.

The bank looks to the Supreme Court to upturn the judgment made by the appeal court.

In the Union Bank’s ‘assessment of contingent liabilities’ contained in its 2022 financial report, according to an online news outlet, the bank admitted the “matter was considered to be a key audit matter due to the size of the potential liability.”

The bank said no provision was made for the N1.49trn judgment liability which is more than half of the lender’s N2.79trn total asset.

Union Bank said, “The Bank is involved in various legal actions in the ordinary course of business, which has resulted in contingent liabilities amounting to N1.497 trillion as of 31 December 2022 (2021: N1.98 trillion).



“The most significant is a case with a total claim of N1.495 trillion (2021: N1.54 trillion) in which judgment had been awarded against the Bank and other co-defendants by a Federal High Court in prior years. The Bank appealed against the judgment, which is currently pending before the supreme court.”

Union Bank is also facing $15bn judgment debt awarded against it by a Federal High Court.

The court had in 2014 reportedly awarded the sum of £2.550 billion with 15 per cent interest yearly to Petro Union Oil and Gas Company Limited (Petro Union).

The case began in 1994 when Petro Union procured a cheque from a branch of Barclays Bank in the UK with a value of £2.556 billion and presented it at one of Union Bank’s branches in Lagos Omonaijablog.com.ng reports.

Petro Union claimed that it planned to construct some refineries and establish a bank with the money.

Union Bank however took the cheque and purportedly refused to give Petro Union the money.

Read full story below
https://newsextra.com.ng/2023/04/21/union-bank-runs-into-trouble-as-n1-49trn-judgment-debt-reportedly-threatens-banks-stability/

Hmmm.

There should be some kind of intervention from CBN if the appeal fails from the supreme Court.