Guaranty Trust Bank on Wednesday got a Federal High Court authorization to take over the funds and assets of Afex Commodities Exchange (AFEX) following the exchange’s default in repaying the N17.808 billion debt owed the deposit money bank under the Central Bank of Nigeria’s (CBN’s) Anchor Borrowers Programme (ABP).
The bank got the temporary authorization in Lagos from the trial Judge, Justice Chukwujekwu Aneke’s, interim Global Standing Instruction (GSI) injunctive relief, after hearing an ex-parte motion filed and argued by GTBank’s lawyers, Chief A. Aribisala and Ade Adedeji, both Senior Advocates of Nigeria (SAN) following its application filed before the court on May 27, 2024,
According to the documents of the plaintiff, the N17.808 billion owed the bank by AFEX comprised “N15.766 billion being the amount outstanding and unpaid, as of April 17, 2024, on the loan facilities (with the accrued interest) granted by the plaintiff to the defendant.
“Pre-judgement interest on the N15.766 billion at the prevailing rediscount rate of 28 per cent per annum approved by the CBN from April 18, 2024, when the plaintiff’s letter of demand dated April 17, 2024, was delivered to the defendant until judgment is delivered in this suit.
“Post-judgement interest on the said sum of N15.766 billion and “Cost of recovery and incidental expenses in the sum of N2.041billion”, the plaintiff alleged.
In the suit marked FHC/L/CS/911/2024, GTBank is the sole plaintiff/applicant while Afex Commodities Exchange is the defendant/respondent, and 27 commercial banks and all money deposit banks were listed as nominal respondents.
The plaintiff averred, in a 285-page affidavit deposed to by Ifeoma Esemudje, one of its staff, that the tenor of the facility was nine months, borrowed to fund smallholder farmers registered under the CBN Anchor Borrower’s programme.
The plaintiff added that the repayment of the loan was to come from the sale of the maize produced by the beneficiary farmers and the maturity maturity date for the repayment of the loan was April 22, 2021.
The plaintiff’s counsels then approached the court for an interim GSI injunctive relief.
Granting the GTBank’s prayer, Justice Aneke ordered a “Place a No Debit” on all monies standing to the credit of Afex Commodities Exchange as of the day the order was served on the 1st to 28th respondent banks.
The GSI was launched in July 2020 by the DMBs and the CBN and it authorizes a creditor bank to recover its debt from any or all other accounts held by the debtor with other financial institutions in case of default by the debtor.
Prior to the GSI regime, borrowers who defaulted on loans to a bank were still able to maintain their bank balances in other institutions, even if those balances were sufficient to repay their debt.
