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Abuja Company Wants Heritage Bank Wound Up Over Insolvency, Distress

Geonel Integrated Services Limited, a security services company, said in a petition filed at the Federal High Court that Heritage Bank has been showing signs of distress and insolvency in recent times and may cause colossal economic damage to Nigerians unless it is wound up by the court.

An Abuja company has asked the Federal High Court and the Central Bank of Nigeria (CBN) to wind up Heritage Bank and revoke its operational licence, citing what it called the bank’s financial insolvency.

Geonel Integrated Services Limited, a security services company, said in a petition filed at the Federal High Court that Heritage Bank has been showing signs of distress and insolvency in recent times and may cause colossal economic damage to Nigerians unless it is wound up by the court.

To that end, it asked the court and CBN to invoke the provisions of Sections 408, 409 and 410 of the Companies and Allied Matters Act 1990 to liquidate the bank as it is unable to meet up with the demands of its customers because it is distressed.

Geonel, which is owned by a foreign investor, Mr. Wolfgang Reinl, an Australian security expert, said in the petition that it maintains four commercial/corporate accounts: #1300083902, 6200100931, #6000105125 and #3200121515, as well as a fixed deposit account, at the Abuja branch of the bank.

The petitioner said it has over N1.8billion and another $85,859 in the accounts and that those huge sums have been trapped in the bank due to its inability to meet up with its obligations.

In the petition filed by Mr. Mazi Afam Osigwe, an Abuja based lawyer, the company alleged that it had made several attempts to withdraw funds by cheque but that the bank failed to honour them.

The petition also noted that in January 2016, a judge of the court, Binta Murtala Nyako, granted the Economic and Financial Crimes Commission (EFCC) an order to freeze the accounts of the company for a period of six months to carry out investigations.

It said that order expired on July 24, 2016, as confirmed by Justice Nyako in a ruling delivered on November 16, 2016.

As a result of the inability of the bank to honour its obligations, the petitioner claimed that the bank has been urging the EFCC to secure a fresh order to stop it the company from accessing or operating the accounts so as to cover up its distressed status.

The petitioner cited several newspaper reports saying that the bank is financially distressed, and the denial by its management of those reports.

It however affirmed that in spite of the public denial of distress, the bank has been unable to honour financial obligations to its customers who rushed to withdraw their money to escape unpleasant economic consequences.

It therefore urged the court to declare the bank distressed, insolvent and to hold that the bank is indebted to it to the tune of N1.8b and another $85,859.

The petitioner also applied for an order of the court to wind up the bank and another order compelling the CBN to withdraw or revoke the bank’s operating licence. 

No date has yet been fixed for hearing of the petition.


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