Senior Advocate of Nigeria (SAN), Chukwuma-Machukwu Ume, has urged the Central Bank of Nigeria (CBN) to take disciplinary action against Polaris Bank for allegedly withholding a loan facility of ₦868 million belonging to his client, Kenchez Nigeria Limited.
In a petition dated October 2 and addressed to the CBN Governor, with copies sent to the Directors of the Consumer Protection and Banking Supervision Departments, Ume accused the bank of breaching a bank guarantee agreement and violating sound banking practices.
The petition was acknowledged by the apex bank on the same day.
Ume, a former Attorney-General of Imo State, described the bank’s actions as a “gross breach of trust and sound banking practice.” He alleged that Polaris Bank’s failure to disburse the approved facility amounted to “an attempted economic murder and financial strangulation of a loyal customer that has banked with Polaris for 22 years.”
According to him, Kenchez Nigeria Limited secured a loan from Lecon Finance Company Limited to purchase a 160-ton Terex Demag AC160-2 Crane for its operations.
He explained that after Lecon Finance approved the facility in June 2025, Polaris Bank issued a bank guarantee of ₦902.7 million in July 2025 to back the loan. However, despite receiving ₦868 million from Lecon Finance as the guarantee bank, Polaris Bank allegedly refused to release the funds to Kenchez Nigeria Limited, even after the company met all the required conditions, including providing a legal mortgage over a property in Port Harcourt, Rivers State.
“Our client duly complied with all requirements, yet the bank has failed to honour its obligation,” Ume stated in the petition.
He noted that the bank’s refusal to disburse the funds, while interest of ₦16.2 million accumulates monthly, violates Section 13 of the Banks and Other Financial Institutions Act (BOFIA).
Ume revealed that Kenchez Nigeria Limited wrote to Polaris Bank on September 15 to resolve the issue amicably. Although the bank initially scheduled a meeting, it allegedly cancelled the meeting on five occasions, which Ume interpreted as a “clear refusal to engage in good faith.”
The lawyer emphasized that the delay has placed a heavy financial burden on his client, forcing the company to incur significant interest costs on idle funds. He added that the withholding of ₦868 million meant for essential equipment has disrupted operations, endangered jobs, and negatively affected local commerce and industry.
He called on the CBN to intervene by directing Polaris Bank to either release or refund the ₦868 million, along with all accrued interest since August 4. He also requested that the apex bank compel Polaris Bank to assume liability for subsequent monthly interest of ₦26,206,860.66 until the funds are disbursed or refunded.
Ume urged the CBN to exercise its regulatory and disciplinary powers to safeguard the stability of the banking sector, protect depositor confidence, and prevent similar practices from taking root in the industry.