Fresh revelations have shed light on the regulatory takeover of Union Bank of Nigeria (UBN), with a forensic audit reportedly uncovering a series of questionable financial transactions tied to the bank’s former owners and directors.
The Central Bank of Nigeria (CBN) had, in January 2024, dissolved the bank’s board and executive management as part of efforts to protect the stability of the financial system. Although the full audit report has not been made public, sources close to the probe say the intervention was triggered by concerns over transactions that could have threatened the bank’s financial health.
Investigators reviewing the audit reportedly flagged issues around financial reporting practices, foreign loan arrangements, and internal fund movements. Some restructuring deals were described as “unorthodox financial engineering,” raising concerns about their potential impact on the bank’s balance sheet.
A major point of concern was a $300 million loan facility obtained from the African Export-Import Bank (Afreximbank) by Titan Trust Bank prior to its merger with Union Bank. According to findings cited in the report, the facility was allegedly unhedged and later moved onto Union Bank’s books without full disclosure, exposing the bank to foreign exchange risks.
The audit also raised questions about whether proceeds from the loan were used in acquiring shares in Union Bank, potentially placing repayment obligations on the bank itself. Analysts note that if proven, such a structure could violate established banking and corporate governance rules.
Further allegations include the diversion of foreign loans from offshore institutions into other financial arrangements, such as swap deals, without adequate disclosure to regulators and stakeholders. The report also pointed to withdrawals from the bank’s funds to service disputed foreign obligations, which may have contributed to foreign currency liquidity pressures during the period under review.
However, these claims remain unproven in court, and no criminal convictions have been announced. Attempts to get responses from the former directors, owners, Titan Trust Bank, and Afreximbank were unsuccessful as of the time of reporting.
Sources familiar with the situation say the CBN’s intervention was primarily aimed at preventing broader systemic risks within the banking sector.
Since the takeover, corrective measures introduced by new management appear to be yielding results. By the third quarter of 2025, Union Bank had begun to recover, improving its market position and meeting key financial obligations. Analysts are optimistic the bank will meet the new N200 billion capital requirement needed to retain its national banking licence.
In a statement following a March 25, 2026 judgment by the Federal High Court in Lagos regarding its actions, the CBN confirmed that Union Bank remains under regulatory management. The apex bank emphasized that the lender is stable and fully capable of meeting its obligations to customers and stakeholders.
The CBN reiterated its commitment to maintaining strict oversight, assuring the public that Union Bank continues to operate safely and remains a reliable institution.
The regulator also noted that while most banks have successfully met recapitalisation requirements, a few institutions—including those under intervention—are still undergoing regulatory and legal processes. It, however, reassured customers that all banks remain fully operational and accessible.
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