Fidelity Bank refutes bankruptcy rumors, clarifies position on $3 Million judgment

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Fidelity Bank Plc has denied rumours suggesting it is on the verge of bankruptcy following a Supreme Court judgement linked to a legacy $3 million credit facility granted by the defunct FSB International Bank in 2002. In a statement signed by its divisional head of brand & communications, Meksley Nwagboh, the bank assured the public, depositors, and stakeholders that it remains financially strong.

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“Fidelity Bank Clarifies Position on Court Judgement Inherited from Defunct FSB International Bank,” the statement read. “By way of a background, we confirm that the issues leading up to the judgement arose from a legacy transaction between the defunct FSB International Bank and Sagecom Concepts Limited.”

The bank explained that FSB granted a $3 million credit facility to G. Cappa Plc in 2002, secured by a mortgage on a property in Ikoyi. However, G. Cappa defaulted on the loan repayment and commenced court action against FSB to prevent the sale of the mortgaged property.

The Federal High Court ruled in favour of the bank, stating that it rightfully sold the leased interest in the property to Sagecom in 2011. However, the court directed the issue of vacant possession to the Lagos State High Court. G. Cappa remained in possession of the property and continued to collect rents.

Fidelity Bank emphasised that it believes G. Cappa is responsible for all losses incurred by Sagecom due to its retention of control of the property and continued collection of rents. “However, after exhausting the appeal process, we are open to settling the obligation,” the bank stated.

The bank is currently seeking judicial clarification on the accurate computation of the judgement sum. Meanwhile, Fidelity Bank assured the public that it is financially strong and preparing to commence the second phase of its recapitalisation exercise after surpassing its target in the first phase. The bank called for calm, urging stakeholders to disregard the rumours surrounding its financial stability.

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