Mr. Austin Obigwe, a former Group Executive Director of Union Bank Plc, yesterday told a Lagos State Special Offences Court how he wrote off a $2.3 million debt owed by Arik Air to his private firm, Staal Corp, due to the airline’s financial difficulties.
Obigwe, who appeared as a prosecution witness in the ongoing trial of former Managing Director of the Asset Management Corporation of Nigeria (AMCON), Mr. Ahmed Kuru, and four others, said the debt was never repaid but was written off as a business decision.
“I am not interested in collecting it. I wrote it off when I discovered that Arik Air started having challenges,” Obigwe told the court during cross-examination.
The Economic and Financial Crimes Commission (EFCC) is prosecuting Kuru, the former Receiver Manager of Arik Air, Mr. Kamilu Omokide; Arik’s CEO, Capt. Roy Ilegbodu; Union Bank of Nigeria Plc; and Super Bravo Limited on a six-count charge of conspiracy, stealing, and abuse of office involving N76 billion and $31.5 million.
All defendants pleaded not guilty and were granted bail by Justice Mojisola Dada in the sum of N20 million each, with a surety in like sum.
Obigwe, under cross-examination, stated that after leaving Union Bank in 2009, he began consultancy work with Arik Air and some other companies.
He also admitted that Arik Air’s founder, Sir Johnson Arumemi-Ikhide, was a personal acquaintance, but there was no current business relationship with Arik Air.
He further told the court that in 2009, he participated in the inspection of 26 Arik aircrafts, which Lufthansa certified as airworthy.
The witness maintained that during his time at Union Bank, there were no complaints from other banks suggesting Arik Air was defaulting on loans, and to his knowledge, the airline was servicing its loans.
He also said he was not aware of an April 23, 2009, letter from AMCON to Union Bank about a N46.11 billion debt allegedly owed by Arik Air.
He acknowledged that lenders can enforce security or reassign loans when borrowers default.
Obigwe described Arik as one of the best-run companies during his tenure at Union Bank, saying, “Until I left the bank in 2009, all facilities extended to Arik were performing. There was no default.”
He explained that Union Bank acted as a guarantor for Arik Air’s acquisition of five aircraft: three Boeing 737-800s for domestic routes, and two Airbus 340-500s for long-haul flights to New York and London.
The loans were financed through export credit agencies, and Union Bank did not provide funds directly but only guaranteed 15 percent of the transaction.
The matter was adjourned till June 4, 2025, for continuation of trial.(Thisday)
