Fidelity Bank fights off debt burden as liquidation stares, clarifies court judgement

Nneka Onyeali-Ikpe, MD/CEO, Fidelity Bank

To say Fidelity Bank is in guagmire is an understatement. Considering the burden of judgment debt it is contending with presently fears are that the bank may be headed for the exit door in business.

On Monday the bank confirmed a subsisting Supreme Court judgment involving G. Cappa and Sagecom Concepts Limited, adding that its computation puts the settlement figure at N14 billion not the N225billion reported by multiple media sources.

The bank described the information contained in the publication by some media platforms as false, unlawful and constitutes contempt of court.

The bank trouble started after G. Cappa allegedly defaulted on loan agreement, with Fidelity Bank going ahead to seize assets belonging to Cappa 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.

However, the bank disclosed in a statement on Monday, May 19, stated that the issues leading up to the judgment arose from a legacy transaction between the defunct FSB International Bank and Sagecom Concepts Limited.

The bank clarified that a sponsored publication of the apex court judgment has allegedly been orchestrated and syndicated in the media with the aim of embarrassing the bank.

In the bank’s statement signed by its Divisional Head, Brand & Communications, Meksley Nwagboh, it responded to a report claiming that the Supreme Court had ordered the financial institution to pay N225 billion in damages to the Nigerian firm.

Clarifying the development, the bank confirmed the legal matter, highlighting that FSB had granted a credit facility to G. Cappa Plc in 2002 for the sum of USD 3 million.

“The facility was secured with a mortgage on a property located in Ikoyi,” it added.

The official explained that G. Cappa allegedly defaulted on the repayment of the loan and, in a bid to prevent FSB from selling the mortgaged property to repay the loan, commenced an action against FSB at the Federal High Court, Lagos, seeking, among other things, 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,” the official added, alleging that in the meantime, G. Cappa remained in possession of the property and continued collecting rents from it.

According to the official, 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 the same over different time frames,” the official stated.

According to the official, the bank is convinced that by remaining in possession of the property and continuing to collect rents from it, G. Cappa allegedly orchestrated all the losses suffered by Sagecom.

Nwagboh maintained, however, that having exhausted the appeal process, the bank is willing to settle the obligation.

“Unfortunately, there are significant ambiguities in the judgment, resulting in difficulties in calculating the actual financial liability to 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,” the official added.

The official claimed that even if the 2018 exchange rate supported by the Supreme Court is applied, “the judgment debt will be just under N30.7 billion, payable to 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.”

The bank said it has applied to the apex court for clarification and an 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 the 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,” the bank added.

The financial institution stressed that it is unfortunate that a clear position and injunctive order made by the court since 7 May 2025 have not been adhered to by relevant stakeholders.

Fidelity Bank maintained that it remains a very strong and profitable financial institution and is among the most capitalized banks in Nigeria today, with international operations.

The bank denied being under bankruptcy, adding that it 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 are available to the public.

Currently, shares of the company are priced at N20.05 in the Nigerian stock market as of market close on 19th May 2025, with a month-to-date performance of 0.50%