Fidelity Bank is facing a financial crisis after the Supreme Court ordered it to pay N225 billion in damages to Sagecom Concept Ltd, a little-known Ibadan-based firm, in a protracted legal battle, MUK TV has learned.
Sources familiar with the situation revealed that the tier 1 bank is scrambling to negotiate a repayment plan, but the urgency of the judgement may limit its ability to stagger the massive liability without risking insolvency.
“To be honest, this is the biggest crisis the bank has ever faced,” a senior bank official told The Gazette in a confidential video conference over the weekend. “The obligation is simply too big.”
“If the bank is miraculously spared, we would have the altruism of the small business that got this unprecedented judgement to appreciate,” the official added, while speaking on condition of anonymity to Peoples Gazette.
Fidelity’s stock closed at N20.80 per share on Friday, reflecting a near 140% rise this year.
However, insiders noted that the bank’s N385 billion profit before tax reported in 2024 was largely driven by rolled-over loans, raising concerns about its ability to absorb the Supreme Court-mandated payout.
The Central Bank of Nigeria (CBN) is reportedly monitoring the situation, with industry insiders speculating that the regulator may step in to prevent the collapse of one of Nigeria’s largest commercial banks during a fragile economic period.
The April 11, 2025, ruling stemmed from a pair of loans, totaling \$3 million and N100 million, obtained by G. Cappa Plc from FSB International Bank in the early 2000s. Fidelity inherited the liabilities after acquiring FSB as part of the 2005 banking sector consolidation.
Court documents reveal that Fidelity began seizing G. Cappa’s assets in Ikoyi and Ibadan after the construction giant allegedly defaulted on its loans in 2005, despite a federal court order prohibiting such actions. Sagecom, which purchased some of the contested properties for N350 million, later sued Fidelity after discovering the bank had violated the court order by selling the assets.
The Supreme Court’s lead opinion, delivered by Justice Adamu Jauro, was scathing in its assessment of Fidelity’s actions.
“Apart from the mountain of evidence against it, allowing the appellant to escape liability as it so desperately seeks to do here would be tantamount to allowing it to benefit from its own wrong,” the court said.
Justice Jummai Hannatu Sankey, in a concurring opinion, added, “This was not mere negligence but a deliberate disregard for both the court’s authority and the first respondent’s rights as an innocent purchaser.”
The judgement confirmed that Fidelity must pay accrued earnings for the flats Sagecom was unable to take possession of due to the prolonged legal battle.
The total damages, calculated by Justice Olabisi Akinlade of the Lagos State High Court, amount to \$139,064,896.18, equivalent to N225,285,131,812.38 as of May 16, 2025, based on an exchange rate of N1620 per dollar.
Fidelity Bank has not officially commented on the ruling, while the CBN and other regulatory bodies have also remained silent.
