The Supreme Court of Nigeria has ordered Fidelity Bank Plc to pay ₦225 billion in damages to an Ibadan-based firm, Sagecom Concept Limited.
According to report, the Fidelity Bank Plc has entered negotiations with legal representatives of Sagecom Concept Ltd to arrange a structured repayment of a staggering N225 billion judgment debt.
However, sources say the urgency outlined in the Supreme Court’s ruling may limit the bank’s ability to stagger payments without facing a solvency crisis.
“This is the biggest crisis the bank has ever faced,” a top official said during a weekend video call, according to People’s Gazette.
“The obligation is simply too big. If the bank survives this, it will be thanks to the goodwill of the small business that won this unprecedented judgment.”
The legal battle stems from two loans taken by engineering firm G. Cappa Plc from FSB International Bank in the early 2000s: one in dollars ($3 million) and another in naira (N100 million).
The loans carried steep interest rates. Fidelity Bank acquired FSB and its liabilities during the 2005 banking sector consolidation.
After G. Cappa allegedly defaulted, Fidelity began seizing assets in Ikoyi and Ibadan that had been used as collateral.
Meanwhile, a federal judge ordered the bank to halt asset sales, but Fidelity ignored the order and proceeded to list the properties for sale — eventually selling some to Sagecom for N350 million.
Sagecom, co-founded by Bamidele Ogunkanmi and U.S.-based Dakore Miriki, later discovered a 2006 court-issued disclaimer prohibiting the sale. The firm sought to recover its funds, citing the injunction.
The case lingered through the Lagos High Court, Court of Appeal, and ultimately reached the Supreme Court in 2018. On April 11, 2025, five justices ruled unanimously in Sagecom’s favour.
Justice Adamu Jauro, delivering the lead judgment, wrote: “Allowing the appellant to escape liability as it so desperately seeks would be tantamount to allowing it to benefit from its own wrong.”
Justice Jummai Hannatu Sankey, in her concurring opinion, called Fidelity’s conduct “a deliberate disregard” for court authority and Sagecom’s rights.
However, the justices unanimously found no miscarriage of justice in the lower courts’ findings, thus upholding the original judgment.
The Lagos High Court had initially ruled in 2011 that Fidelity owed Sagecom compensation for years of lost rental income on the disputed properties.
Justice Olabisi Akinlade recently updated the award to reflect current values: $139 million or N225.3 billion, using an exchange rate of N1,620 per dollar as of May 15, 2025.
Fidelity is expected to challenge the final calculation during a scheduled court hearing on May 19, but insiders say changes are unlikely.
Justice Akinlade has already stated that the naira equivalent will ultimately depend on the official rate on the actual date of payment.
Fidelity Bank, currently led by its first female CEO, Nneka Onyeali-Ikpe, is Nigeria’s sixth-largest bank by assets.
Former presidential candidate, Peter Obi, once chaired the bank before becoming Anambra State governor in 2003.
But Fidelity Bank Plc has specifically debunk media reports suggesting it was facing bankruptcy over the Supreme Court judgment linked to the legacy $3 million credit facility granted by the defunct FSB International Bank in 2002.
Similarly, the Central Bank of Nigeria (CBN) on Monday, reassured the public, depositors and stakeholders that the Nigerian banking sector remains safe, resilient and healthy.
However, in its clarification, Fidelity Bank said that the judgment debt emanated from a long-standing legal dispute inherited through its acquisition of FSB, adding that it was currently seeking judicial interpretation on the accurate computation of the judgment sum.
The bank made this known through a statement by its Divisional Head, Brand & Communications, Meksley Nwagboh, reaffirming its strong financial position and condemned the reports insinuating bankruptcy as misleading, malicious, and in violation of a standing court order.
This comes on the heels of the bank’s preparation to begin the second phase of its recapitalisation exercise. In the first phase, Fidelity Bank had surpassed the N127.1 billion target it had set in its combined offer programme.
However, in the statement yesterday, titled: “Fidelity Bank Clarifies Position on Court Judgement Inherited from Defunct FSB International Bank,” the bank explained: “By way of a background, we confirm that the issues leading up to the judgment arose from a legacy transaction between the defunct FSB International Bank and Sagecom Concepts Limited.
“FSB granted a credit facility to G. Cappa Plc in 2002 for the sum of $3 million. The facility was secured with mortgage on a property located in Ikoyi. G. Cappa defaulted on the repayment of the loan and in a bid to prevent FSB from selling the mortgaged property to repay the loan, G. Cappa commenced an action against FSB at the Federal High Court, Lagos seeking inter-alia to restrain the Bank from selling the property.
“The Federal High Court in its judgment ruled that the Bank as legal mortgagor rightfully sold the leased interest in the property to Sagecom in 2011. The Court however declined to order vacant possession of the property and directed the issue of vacant possession to the Lagos State High Court. In the meantime, G. Cappa remained in possession of the property and kept collecting rents therefrom.
“Sagecom then instituted an action against the Bank and G. Cappa at the Lagos State High Court in 2011 seeking damages against the Bank for breach of contract and for possession of the property. Sagecom’s claim against the bank was essentially for liquidated damages calculated as rentals on the several component apartments in the property plus interest on same over different time frames. In 2018, the Lagos High Court awarded judgment in favour of Sagecom against G. Cappa and the Bank which judgment was challenged at the Supreme Court.”
Furthermore, the financial institution stressed that it was convinced that by remaining in possession of the property and continuing to collect rents therefrom, G. Cappa orchestrated all the losses suffered by Sagecom.
It, however, pointed out that having exhausted the appeal process, it was willing to settle the obligation. “Unfortunately, there are significant ambiguities in the judgment resulting in difficulties in calculating the actual financial liability to the G. Cappa and the bank, which is about N14 billion from our computation based on the exchange rate as of 2005, when the incident and cause of action arose. “Meanwhile the Supreme Court in the case of Anibaba v Dana Airlines Limited delivered in January 2025 has clarified that foreign currency judgment debt must be converted to Naira at the exchange rate obtainable at the date of judgment of the trial Court which in this case was 30 January 2018.
“Even if the 2018 exchange rate supported by the Supreme Court is applied, the judgment debt will just be under N30.7 billion payable by G.Cappa Plc (who delayed delivery of possession of the apartments from 2005 till June 2018, when possession was eventually delivered) with contribution from the bank.
“Consequently, the bank has applied to the Court for a clarification and inquiry into the proper interpretation of the judgment and the computation of the actual quantum properly and lawfully payable by G.Cappa and the bank.
“The Court has accordingly ordered Sagecom to maintain status quo pending the determination of pending motions and restrained Sagecom and all persons from publishing any material in the media as the matter is still pending in court,” it added.
It therefore stated that a publication by an online media contained and some other persons contained false information and was wrong, unlawful and constituted a contempt of court.
“It is unfortunate that the above clear position and injunctive order made by the Court since 7th May 2025 was not adhered to. Fidelity Bank remains very strong and profitable financial institution and amongst the most capitalised bank in Nigeria today with international operations.
“The bank is under no bankruptcy and has always been in a position to discharge its proper and lawful obligations and wishes to assure its depositors, customers, investors and the general public that the bank is in a strong financial position as shown in its Q1 2025 financial results which is available to the public.
“Meanwhile, the bank is taking all necessary steps to apprehend and prosecute any persons or platform directly or indirectly responsible for this wicked, malicious and sponsored publication aimed at embarrassing the bank and causing panic to its stakeholders,” it added.
Meanwhile, in a statement by the Acting Director, Corporate Communications, CBN, Mrs. Hakama Sidi Ali, the CBN stated that its attention was drawn to certain publications and social media reports “containing misleading information regarding the operations of a regulated financial institution.”
It added: “The CBN wishes to categorically reassure the public, depositors, and stakeholders that the Nigerian banking sector remains resilient, safe, and sound. Like all other regulated institutions, the institution referenced in these reports is held to stringent regulatory requirements, and there is no cause for concern regarding the safety of depositors’ funds.”
The central bank affirmed that it continues to monitor all financial institutions under its regulatory purview and maintains robust frameworks for early warning signals and risk-based supervision.
“These mechanisms ensure that any emerging issues are promptly addressed to protect the integrity of the financial system. We urge the public to disregard sensational or unverified claims and rely solely on official channels for information about the financial system.
“The CBN remains dedicated to fostering a secure banking environment where depositors can be fully confident in the safety of their funds. It will continue to monitor and adapt strategies to safeguard the financial interests of all Nigerians and stakeholders in our financial system,” it added.
However, the bank had emphasised that the court did not at any time award the amount(N225bn) that as was reported by some online media, adding that the amount could only be determined at the end of proceedings.
“The bank is a solid financial institution capable of paying its proper and lawful debt as may be determined by the Court at any point in time,” it added.
The stock price of Fidelity Bank yesterday, dropped by 3.8 per cent or N0.80 per share to close at N20 per share from N20.80 per share the stock closed for trading last Friday. The lender’s stock reached N21 per share last week, amid declaring impressive first quarter ended March 31, 2025, results to the investing public.
Fidelity Bank Plc has demonstrated remarkable financial resilience, solidifying its position as one of Nigeria’s leading financial institutions.
Recent reports highlight the bank’s impressive growth trajectory, including its re-entry into the N1 trillion market capitalisation club and a 167.8 percent increase in profit before tax (PBT) to N105.8 billion in the first quarter of 2025.
Fidelity Bank also recorded a 64.2 percent year-on-year increase in gross earnings to N315.4 billion in Q1 2025. The bank’s total deposits surged to N6.6 trillion, driven by a 21.4 percent increase in foreign currency deposits in the review period. These figures highlighted its ability to attract and retain capital, ensuring liquidity and operational efficiency.
The board and management of the bank recently indicated that they aim to conclude the final phase of its recapitalisation programme this year, ahead of the 2026 deadline set by the Central Bank of Nigeria (CBN).
Addressing shareholders at the annual general meeting of the bank, Chairman, Fidelity Bank Plc, Mr. Mustafa Chike-Obi, had said the bank’s stakeholders were all pleased with the success of the first stage of the capital-raise exercise.
“The oversubscription of 237.9 per cent in the public offer and 137.7 per cent in the rights issue is a testament to the strength of our brand and the confidence the investing public has in us. Equipped with this vote of trust, we will proceed swiftly and conclude the second tier of our capital-raise exercise,” Chike-Obi had said.
