Court Puts Injunction On Stanbic Bank AGM

A High Court in Accra has placed an interlocutory injunction restraining the management of Stanbic Bank Ghana Limited from holding its 22nd Annual General Meeting (AGM).

According to the court order, the defendant is barred from holding the said meeting which is scheduled for May 5, 2021 “on the 4th floor, Stanbic Heights, Airport, Accra or any venue in Ghana or beyond.”

The order is to last for 10 days after which another application is to be repeated on notice.

The injunction follows a suit filed by Union Mortgage Bank Limited and a Real Property Consultant, Kwame Charles Serbeh-Yiadom, challenging the incorporation of Stanbic Bank Ghana Limited in accordance with the Companies Act, 1963 (Act 179).

The suit, filed by the plaintiff’s lawyer, Kwaku Ansah Asare, against Stanbic Bank Ghana Limited and 15 other defendants, is challenging the manner in which Standard Bank Investment Corporation purportedly executed a share transfer agreement on March 3, 1999, in South Africa with persons who held themselves out as the original subscribers/shareholders of Union Mortgage Bank Limited (UMB).

Mr Serbeh-Yiadom, who was one of the two (2) original subscribers/shareholders of UMB, is contending that he was not privy to the transaction in South Africa between UMB and Standard Bank Investment Corporation even though he and Alhaji Fatawu El-Aziz, the first defendant, incorporated UMB Ltd.

He further argues that pursuant to the agreement between SBIC Africa Holdings Limited (SAHL), and UMB, the latter was required to acquire 3,257,350 ordinary shares at no par value representing 75.1% of the share capital of UMB Limited as a condition precedent to the changing of the name of Union Mortgage Bank Limited to Stanbic Bank Ghana Ltd.

He averred that SBIC Africa Holdings Limited has to date failed, refused or neglected to acquire 75.1% of the share capital of UMB Limited as stipulated in the agreement aforementioned.

The plaintiffs averred further that despite breaching the terms and conditions of the agreement, Alhaji Fatawu El-Aziz and one Edward Afriye purportedly changed the name of Union Mortgage Bank Limited into Stanbic Bank Ghana Limited by a special resolution dated July 27, 1999.

It is the case of the plaintiffs that the change of name UMB Limited to Stanbic Bank Ghana Limited on July 27, 1999, “was procured by fraud because not only was Stanbic Bank Ghana Limited not in existence at that date but also, Edward Afriye with whom 1st defendant (Alhaji Fatawu El-Aziz) signed the Written Special Resolution was not an original subscriber/shareholder.”

The plaintiff is alleging that the original subscribers/shareholders at incorporation were falsified from two to seven thereby making it fictitious.

Again, the plaintiffs alleged that the stated capital of UMB Limited on March 8, 1994, to wit the date of incorporation, was fraudulently altered to be GH¢1,080,000,000 as captured in the purported annual report returns filed by the defendants on August 20, 1999, and claimed the share transfer which was used to support the change of name did not exist as substantiated by a report of the Registrar of Companies dated May 7, 2020.

The plaintiff is insisting that he retains 500,000 shares in the company and 10,000 shares allotted to him by the bank is false and is part of the fraud complained of.

He wants a declaration that Union Mortgage Bank Limited was originally registered with the said name on March 8, 1994, with 10,000,000 ordinary shares of no par value with Prof. Serbeh-Yiadom and Alhaji Fatawu El-Aziz being its promoters and original subscribers/shareholders.

They also want a declaration that 10,000,000 shares were issued at incorporation and the same subscribed equally by Kwame Charles Serbeh-Yiadom with 500,000 shares worth GH¢500,000,000 and Alhaji Fatawu El-Aziz with 500,000 worth GH¢500,000,000.

They further want a declaration that Stanbic Bank Ghana Limited was originally registered as Union Mortgage Bank Limited on March 8, 1994, and that the change of name into Stanbic Bank Ghana Limited was procured by fraud.

In the substantive case, the bank has reportedly entered a conditional appearance and when the plaintiff received an invitation to the AGM, he went to court ex parte to stop the move.

It is unclear if the bank has been served with the processes stopping them from holding the AGM.

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