In a case filed as FHC/L/CS/911/2024 at the Federal High Court, Lagos division under Justice CJ Aneke, GTBank has accused these bank executives of failing to enforce a court-ordered No-Debit-Order placed on AFEX’s accounts. The court had directed these measures in its ruling on May 27, 2024, related to the loan dispute between GTBank and AFEX.
A legal notice published in national dailies, including The Punch, detailed the court’s authorization for GTBank to proceed with Form 48 (Notice of Consequences of Disobedience to Court Order) against the 60 parties. This includes company heads from Access Bank, Citibank, Jaiz Bank, Union Bank, Fidelity Bank, and others.
The dispute originates from a loan facility provided by GTBank to AFEX under the Central Bank of Nigeria’s Anchor Borrowers Programme, intended to support smallholder farmers. AFEX reportedly failed to repay a total of N17.81 billion, which includes outstanding principal and recovery costs.
In response, the court allowed GTBank to take over 16 AFEX warehouses across seven states to liquidate commodities procured with the loan. AFEX has acknowledged partial repayment but cited economic challenges impacting farmers’ ability to fully settle their debts.
Despite ongoing discussions with the CBN and other stakeholders, AFEX criticized GTBank’s legal actions as premature, urging for the activation of the programme’s collateral guarantee to mitigate losses for affected farmers.
The Anchor Borrowers Programme, initiated in 2015 by the CBN, aimed to enhance agricultural output and ensure food price stability by linking smallholder farmers with processors. However, recent macroeconomic challenges and policy shifts have complicated loan recoveries under the programme.
The case underscores broader issues in Nigeria’s financial sector concerning loan recovery mechanisms and compliance with court orders amidst economic uncertainties.
