Wema Bank Rejects Allegations Over Banana Island Properties Linked to Defunct Gulf Bank

Wema Bank Plc has dismissed recent media reports alleging wrongdoing in the sale of Banana Island properties connected to the defunct Gulf Bank Plc, describing the publications as false, misleading and malicious.

In a statement issued on Monday in Lagos, the bank said the reports distorted the facts surrounding a long-standing debt recovery process that originated from an inter-bank placement transaction dating back to 2002.

According to Wema Bank, it made an inter-bank placement of ₦4.6 billion with Gulf Bank Plc in 2002. The exposure was later reduced to about ₦1.2 billion by August 2004 before the obligation became delinquent.

The bank explained that in its effort to recover depositors’ and shareholders’ funds, it initiated lawful recovery proceedings that later aligned with investigations conducted by the Economic and Financial Crimes Commission.

Wema Bank stated that EFCC investigations revealed that the funds were allegedly diverted and used to acquire properties in Banana Island, Lagos, through two companies identified as Bacad Finance & Investment Company Ltd, now known as Supra Commercial Trust Limited, and Euston Wenberg Eng Ltd.

The bank stressed that both entities are separate and distinct from Gulf Bank Plc and are not under the supervision of the Nigeria Deposit Insurance Corporation.

According to the statement, the companies voluntarily relinquished their proprietary interests in the Banana Island properties as part of efforts to settle Gulf Bank’s indebtedness to Wema Bank.

Wema Bank further disclosed that the NDIC formally acknowledged Gulf Bank’s indebtedness in letters dated September 26, 2007 and June 10, 2009. The letters, according to the bank, were addressed to the Federal Land Registry and Wema Bank respectively.

The lender added that the documents had already been submitted before the Federal High Court in Lagos in ongoing proceedings presided over by Justice Allagoa.

The bank also claimed that after the disposal of the properties, the NDIC paid the outstanding shortfall owed to Wema Bank, arguing that the development demonstrated the corporation’s awareness and participation in the settlement process.

While confirming that the NDIC has instituted two separate legal actions against the bank at the Federal High Court, Lagos, Wema Bank maintained that the lawsuits do not alter the facts surrounding the transactions.

The bank said the matter is currently before the court and therefore sub judice, adding that it would refrain from commenting further on issues pending judicial determination.

“We unequivocally reject these claims, which are inaccurate, malicious, and clearly intended to distort the true position,” the bank stated.

Wema Bank said it would continue to pursue all lawful means to defend its interests and protect stakeholders.

The lender reaffirmed its commitment to corporate governance, regulatory compliance and ethical banking practices while assuring shareholders and customers of its dedication to transparency and responsible operations.

Wema Bank Plc is the operator of ALAT, described as Africa’s first fully digital bank, and maintains more than 150 branches and service stations across Nigeria.