N150m Loan: BOI, Unity Bank, Firm In Legal Tussle

Share

The Bank of Industry (BoI) and the Unity Bank Plc on Tuesday are locked in a legal battle at the Federal Capital Territory (FCT) High Court, Maitama, over non-performance of N150 million loan granted to an Abuja-based company, Valentino Project Ltd. by the BoI.

In 2012, Valentino Project Ltd. had secured the N150 million loan to construct water treatment factory and production in Kuje, FCT with the Unity Bank acting as its guarantor.

Admitting the facts of the case that a loan of N150 million was given to Valentino to set up a water treatment factory and production line in Kuje, the plaintiff’s counsel, Mr Toluwaseun Alabi said; “it did just that, while Unity bank acted as the guarantor to Valentino.”

Alabi said curiously Valentino received a communication from BOI in August 2013 stating that the transaction has been terminated. He however argued that since the loan was for five years and still operational; it would amount to a breach of agreement if it was terminated.

“Valentino Project Ltd. has built the water treatment factory and production in Kuje and bought the needed equipment, in fact everything is on ground”, he said.

Alabi said Valentino had refused to commence work because of the problem it had encountered, adding that the project was stalled because the N150 million had not been fully disbursed.

According to him, “It was just remaining about N5million to complete the loan and finish the project because the company has built the factory and set up everything.

“But because the Relationship Manager of Unity Bank and the people handling the facilities on behalf of BOI and Valentino Project Ltd. were not having the best of times, it just cut off as guarantor without recourse to the investment.’’

Alabi said there was a project appraisal before the BoI gave out the loan, adding that based on Valentino’s performance, the loan was given to the company.

However, in his submission, Counsel to the defendant, Unity Bank, Peter Inegi said the loan was given out to Valentino with conditions and some obligations attached to it.

He explained that the company was expected to perform based on those conditions and obligations, adding that 100 per cent performance was expected before any intervention.

“Unity Bank acted as Valentino Project Ltd. guarantor for N150 million to BoI, but BoI had to act by withdrawing from Valentino Project Ltd. for non performance of obligations”, Inegi said

NAN reports that arising from submissions from both parties, Justice Peter Affen of the FCT High Court, Maitama has however reserved judgment to a later date that would be communicated to them.

Similar Posts

Leave a Reply