Licence revocation: Court refuses Aso Savings, Union Homes’ plea against CBN, NDIC

The Federal High Court in Abuja on Tuesday, declined to grant an application seeking to stop the Central Bank of Nigeria (CBN) and Nigeria Deposit Insurance Cooperation (NDIC) from taking further actions over the recent revocation of licences of two mortgage financial institutions.

The two institutions are Aso Savings and Loans Plc and Union Homes Savings and Loans Plc by the CBN.

Justice Emeka Nwite, in a ruling on the plaintiffs’ ex-parte motion moved by their lawyer, Joseph Silas, rather held that the interest of justice would be better met by putting the defendants on notice.

“I have listened to the submission of the counsel for the plaintiff/applicant and I have gone through the affidavit evidence, the exhibit including the written address.

“I am of the opinion and I so hold that the interest of justice will be met by putting the defendants on notice.

“I hereby ordered that the defendant be put on notice to come and show cause while the relief should not be granted,” the judge ruled.

Justice Nwite, who sits as vacation judge, adjourned the matter until Jan. 5, 2026 for the defendants to show cause.

Our correspondent that Aso Savings, Union Homes, Ridhwan Hamza and Ismaila Adamu are 1st to 4th plaintiffs respectively in the motion ex-parte marked: FHC/ABJ/CS/2776/2025.

The plaintiffs had sued the CBN and NDIC and 1st and 2nd defendants.

In the motion dated Dec. 22 but filed Dec. 23 by Silas, they sought two reliefs.

“An order of this honourable court restraining the defendants/respondents from taking further steps on the purported revocation of the operational licence of the 1st and 2nd plaintiffs, pending the hearing and determination of the motion on notice.

“An order of this honourable court barring the defendants/respondents from enforcing their unlawful decision in any way, form or manner, against the 1st and 2nd plaintiffs/applicants, pending the hearing and determination of the motion on notice.”

Given four-ground argument, the lawyer argued that the CBN did not follow the condition precedent to the invocation of its power to revoke the operating licence of the 1st and 2nd plaintiffs/applicants.

Silas submitted that the NDIC also had, without allowing the two mortgage institutions to exhaust their rights of action, moved to curtail such rights by attempting to take over the 1st and 2nd plaintiffs/applicants.

“That if the defendants/respondents are not restrained, they will impose upon the plaintiffs/applicants their unlawful decisions in an irreversible way.

“That it is necessary to restrain the defendants/respondents from taking any other step in the interest of justice,” the lawyer said.

In the affidavit in support of the motion ex-parte, Ridhwan Hamza, an Aso Savings Shareholder and the 3rd plaintiff in the suit, acknowledged that the institutions had operational challenges which was within the knowledge of the CBN.

He averred that the CBN, without carrying out any measure to intervene on the failures of the plaintiffs, gave Aso Savings an ultimatum to meet its minimum capital requirement “by ensuring that all share reconstruction activities are concluded in a manner that fully address the capital shortfall not later than Aug. 31, 2025.”

Hamza said: “I know that notwithstanding the positive updates made to the 1st defendant/respondent by the plaintiffs/applicants, on Dec. 16, 2025 in a press release titled, ‘Revocation of the Operational Licenses of Aso Savings and Loans Plc and Union Homes Savings and Loans Ple.

” The first defendant/respondent, relying on Section 12 of BOFIA 2020 and Section7.3 of its Revised Guidelines for Mortgage Banks, revoked the license of the plaintiffs/applicants.

“I know that the 1st defendant/respondent grounded its decision on:

“Failure to meet the minimum paid-up share capital requirement for the category of the bank licence granted to the plaintiffs/applicants

“Having insufficient assets to meet its liabilities.

“Being critically undercapitalised with a capital adequacy ratio below the prudential minimum ratio as prescribed by the 1st defendant/respondent; and

“Failure to comply with several directives and obligations imposed upon the plaintiffs/applicants by the 1st defendant/respondent.”

He, however, said that the CBN was aware of all the steps and progress made by the Aso Savings in raising its minimum capital requirement, with absolute success.

He said CBN did not act in public interest when it made the press release revoking the operational license of the two institutions, without following the requirement of Section 34 (4) of the Banks and Other Financial Institutions Act, 2020.

According to him, the action of the 1st defendant/respondent was arbitrary, rash unreasonable and runs contrary to public policy of developing the Nigerian economy, creating jobs and encouraging investments.

Hamza said the NDIC had sent out messages to Aso Savings’ customers “asking them to fill out an online claims form against the plaintiffs/applicants, even as the law allows the plaintiffs/applicants a window of 30 days to challenge the actions of the 1st defendant/respondent.

“I know that the steps taken by the 2nd defendant/respondent is aimed at extinguishing the right of the plaintiffs/applicants to challenge the actions of the 1st defendant/respondent by immediately commencing liquidation process.

“I know that the plaintiffs/applicants have constitutional rights to be heard fairly and to challenge the actions of the defendants/respondents.”

He said that the defendants would not be prejudiced by the granting of the application and that it was just, equitable and within the law that the application be granted.

Our correspondent had, on Dec. 16, reported the revocation of the operating licences of Aso Savings and Loans Plc and Union Homes Savings and Loans Plc by the CBN.,