Nigeria Deposit Insurance Corporation (NDIC) has expressed intention to appeal against a ruling of Investment and Securities Tribunal (IST) asking it to pay Winners Medical Diagnostic & Research Institute Ltd the sum of 5,000,000. 00 at two per cent interest above the CBN MRR from March 2006 when NDIC took over All States Trust Bank until the full payment of the principal sum.
IST made the order after declaring that it was wrong for the NDIC, to classify or categorise the claim for return money for un-allotted shares regulated by ISA 1999 (repealed and re-enacted as ISA 2007) and SEC Rules and Regulations made pursuant thereto as general credits ranking subordinate to private deposits of the defunct All States Trust Bank, payable only after claims for depositors liabilities have been satisfied.
Winners Medical Diagnostic & Research Institute Ltd had dragged NDIC, Ecobank Nigeria Limited, All States Trust Bank Plc (In liquidation), First Registrars & Investor Services Limited, First Bank Plc, BGL Securities Limited, Central Bank of Nigeria and Securities & Exchange Commission before IST over the decision to categorise it as a creditor following its payment of N5 million to acquire shares in All States Trust Bank initial public offer.
After the payment but before share allotment, the bank had become depressed and acquired by Ecobank.
IST ruled that Winners had no contractual relationship with the All States “for which it is expecting payments, but was rather a subscriber to its aborted IPO, whose money is by extant Capital Market law, rules and regulations termed
“Return Money”, to be refunded by the entity in the custody of the money. ALSO READ: Lagos Assembly passes bill prohibiting unlawful societies, cultism into law “NDIC having not denied that it took over the subscription money for the aborted All States Trust Bank Initial Public Offer, should be in a position to refund to Winners Medical Diagnostic & Research Institute Ltd the sum of N5, 000, 000.00, it paid for the un-allotted shares of All States Trust Bank.”
The Tribunal also awarded a cost of N500, 000.00 in favour of Winners Medical Diagnostic & Research Institute Limited.
In a reaction, however, NDIC said the position that the decision of the tribunal was in error as it misconstrued and consequently misapplied the clear and express provisions of the relevant legislation governing bank liquidation in Nigeria.
After quoting applicable legislations, which include the Companies and Allied Matters Act [CAMA] 2020, Banks and […]
