An indigenous Nigerian company, Kenchez Nigeria Limited, has called on the Central Bank of Nigeria (CBN) to take immediate regulatory action against Polaris Bank for allegedly withholding a loan facility of N868 million in violation of guarantee terms.
![](https://thenigerialawyer.com/wp-content/uploads/2025/05/idrinstitute.png")
In a letter dated October 2, addressed to the CBN Governor and Director of Consumer Protection, and signed by the company’s lawyer, former Imo State Attorney General Chuckwuma-Machukwu Ume, Kenchez Nigeria Limited detailed what it described as numerous unethical practices by Polaris Bank, claiming these actions contravene banking laws and regulatory safeguards.
Ume explained that the funds, disbursed by Lecon Finance Company Limited to Polaris Bank under the bank’s guarantee, were meant for the acquisition of a 160-ton Terex Demag AC160-2 Crane to support Kenchez Nigeria Limited’s operational activities.
“Polaris Bank’s refusal to release N868 million, despite full compliance with all preconditions including a perfected legal mortgage over valuable property in Port Harcourt, transcends mere breach of contract. It amounts to financial strangulation of a company that has maintained 22 years of unbroken banking loyalty with the institution,” Ume stated.
Kenchez Nigeria Limited had applied to Lecon Finance on March 6, 2025, for a finance lease facility of N902.72 million to acquire the crane. Lecon Finance approved the facility in May and June 2025, subject to the provision of a bank guarantee. Polaris Bank subsequently issued a guarantee letter on July 8, 2025, specifying that the funds were to secure the lease facility.
Despite the loan being fully credited to Polaris Bank, the lender has allegedly refused to release the funds, even as the company continues to pay accruing interest, now reportedly totaling N16.2 million monthly. According to Ume, repeated attempts to resolve the matter through scheduled meetings with Polaris Bank have been cancelled five times, indicating “a deliberate refusal to engage in good faith.”
The legal letter argues that the bank’s actions contravene Section 13 of the Banks and Other Financial Institutions Act (BOFIA) 2020, which mandates sound banking practices, as well as the CBN Consumer Protection Regulations, 2019. The lawyer described the withholding of funds as “an attempted economic murder” that has disrupted Kenchez Nigeria Limited’s operations and threatened local employment and industrial activity.
Kenchez Nigeria Limited is now urging the CBN to direct Polaris Bank to immediately release or refund the N868 million, cover accrued interest, assume liability for all future interest until resolution, and exercise its supervisory powers to prevent similar industry-wide abuses.
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