A Lagos federal high court has ordered the restoration of the former board of Union Bank, led by Farouk Mohammed Gumel, in a ruling that challenges the authority of the Central Bank of Nigeria (CBN). The court determined that the CBN acted beyond its powers when it dissolved the bank’s board and management in January 2024.

The court’s decision quashed all actions taken by the CBN-appointed board, mandating the immediate reinstatement of the former management. Additionally, the ruling restrained the CBN and its appointed board from pursuing any recapitalization efforts or related activities, effectively halting their plans.

This ruling follows the CBN’s controversial announcement in January 2024, which led to the dissolution of Union Bank’s board and management. Core shareholders of the bank subsequently filed a motion seeking a judicial review of the CBN’s actions, culminating in this significant court ruling.

In acknowledging the judgment, the CBN stated that it is reviewing the court’s decision carefully. The central bank reassured the public that Union Bank’s status remains unchanged and that it continues to meet its obligations to customers.

However, industry experts have expressed concerns regarding the implications of the ruling. Chika Mbonu warned that the court’s decision could undermine depositor confidence and disrupt banking operations. “Banking is almost essentially a confidence game… the depositors want to make sure their money is safe,” Mbonu stated, emphasizing the risks associated with uncertainty in governance.

Mbonu further cautioned that if the situation is not resolved swiftly, it could lead to a prolonged conflict between the CBN and Union Bank. He noted, “If things are not resolved quickly… it can become a war of attrition.”

Despite the CBN’s assurances that Union Bank is safe and capable of fulfilling its day-to-day obligations, the potential impact of the ruling on depositor confidence and overall banking operations remains unclear. Details remain unconfirmed regarding whether the current board can continue to carry out administrative actions after the court ruling.

For the CBN, this ruling represents a significant setback, as it must ensure compliance with legal standards moving forward. Mbonu remarked, “For the CBN, I think it’s a major setback… they have to make sure they dot all the ‘i’s and cross all the ‘t’s.” As the situation develops, stakeholders will be closely monitoring the implications of this ruling on the banking sector in Nigeria.

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In January 2024, the Central Bank of Nigeria (CBN) made a significant move by dissolving the board and management of Union Bank, appointing Yetunde Oni as managing director and Mannir Ubali Ringim as executive director. This decision was met with immediate backlash from core shareholders, including Titan Trust Bank, Luxis International, and Magna International, who argued that the CBN’s actions were beyond its legal authority.

On March 26, 2026, a decisive moment occurred when the Federal High Court ruled in favor of the shareholders, ordering the restoration of the former board led by Farouk Mohammed Gumel. The court found that the CBN had acted ultra vires, meaning it had exceeded its powers, and ruled that its actions were not compliant with the Banks and Other Financial Institutions Act (BOFIA) 2020.

The court’s ruling quashed all decisions made by the CBN-appointed board and management of Union Bank, effectively halting the ongoing recapitalization process initiated under their leadership. The judgment highlighted that the shareholders’ fundamental rights were breached, as their shareholding had been reduced from 100% to 40% without a legal basis.

Justice Chukwujekwu Aneke, who presided over the case, stated, “The CBN acted beyond its powers in removing the board and management of Union Bank in January 2024.” This ruling not only reinstated the former board but also restrained the CBN and its appointed board from taking any actions related to the bank’s recapitalization.

In the wake of the ruling, the CBN acknowledged the court’s judgment and expressed its commitment to reviewing the decision while reaffirming its role in ensuring the stability and safety of Union Bank’s operations. CBN spokesperson Hakama Sidi Ali remarked, “The CBN will continue to provide the necessary regulatory oversight to ensure Union Bank operates in a safe, sound, and stable manner.”

The court’s decision has significant implications for Union Bank and its stakeholders. It not only restores the former leadership but also raises questions about the future of the bank’s operations and the legitimacy of the actions taken by the CBN-appointed board. With a capital shortfall of 224 billion Naira reported, the bank’s financial health is under scrutiny, and the shareholders’ investment of 190 million dollars is now in a precarious position.

Details remain unconfirmed regarding whether the current board can continue to carry out administrative actions following the court ruling. The situation remains fluid as stakeholders await further developments in the aftermath of this landmark decision.

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Prior to the recent court ruling, the Central Bank of Nigeria (CBN) had dissolved the board and management of Union Bank in January 2024, leading to significant changes in the bank’s leadership. This action was met with considerable pushback from the bank’s core shareholders, who challenged the legality of the CBN’s decision.

On March 25, 2026, the Federal High Court in Lagos delivered a decisive ruling, nullifying the CBN’s earlier dissolution of Union Bank’s board and management. Justice Chukwujekwu Aneke ordered the immediate reinstatement of the former leadership, effectively invalidating all actions taken by the CBN regarding the bank’s management.

The court’s decision also included a restraining order against the CBN, preventing it from taking further steps concerning Union Bank, including any actions related to recapitalization. This ruling marked a significant shift in the governance of Union Bank, reinstating the leadership that had been in place prior to the CBN’s intervention.

In January 2024, the CBN had appointed Yetunde Oni as Managing Director/CEO and Mannir Ubali Ringim as Executive Director, but these appointments were rendered moot by the court’s ruling. The core shareholders of Union Bank had previously sought interim relief, which was granted by the court on December 5, 2025, highlighting the ongoing legal battle over the bank’s leadership.

Following the court ruling, the CBN is now in the process of obtaining a Certified True Copy of the court’s decision regarding its takeover of Union Bank. The central bank has expressed its commitment to operate within established legal processes, emphasizing the importance of adhering to the rule of law in financial governance.

Justice Aneke’s statement underscored the court’s position, noting, “The court has effectively invalidated all actions taken by the apex bank in respect of the bank’s leadership change.” This ruling not only reinstates the former board but also raises questions about the CBN’s authority and its future actions concerning Union Bank.

In response to the ruling, the CBN reassured the public, stating, “The CBN assures Nigerians that the status of the Union Bank remains unchanged and is able to meet its obligations to customers, depositors, and stakeholders.” This statement reflects the central bank’s intention to maintain stability in the banking sector despite the legal challenges it faces.

The outcome of this case is likely to have lasting implications for Union Bank and its stakeholders, as well as for the regulatory landscape in Nigeria’s banking industry. As the situation develops, the focus will be on how the CBN navigates its relationship with Union Bank moving forward.

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