Polaris Bank Limited is facing a $6.21 million payment to a Danish shipping company after a federal court in New York ordered the release of the Nigerian bank’s frozen funds to settle a long-running dispute over a cargo of gypsum delivered to Lagos in 2021.
In an order signed on November 5, 2026 and seen by Secrets Reporters, the United States District Court for the Southern District of New York directed Standard Chartered Bank in New York to release and transfer $6,214,196.08 belonging to Polaris Bank to Norden, the Danish shipping company, on or before November 12.
The order also brought the case to an end, dismissing it with prejudice after the parties reached a settlement. It further provided that Norden could return to court to enforce the agreement if Polaris Bank failed to make the required payment.
The development followed months during which Polaris Bank’s funds remained under judicial attachment in the United States, while the bank repeatedly secured extensions to respond to the lawsuit without filing an answer to the claims.
The dispute originated from a 2021 shipping transaction involving the vessel Lady Demet, which transported 27,000 metric tonnes of gypsum from Safi, Morocco, to Lagos for exporter Gypse Expo.
Quattro Marine and Petrochemical Nigeria Limited purchased the cargo for onward sale to Lafarge Africa Plc, with Polaris Bank providing financing through a letter of credit.
Under a voyage charter agreement dated June 28, 2021, freight was fixed at $39.95 per metric tonne, while demurrage — the charge payable when a vessel is delayed beyond the agreed loading or unloading period — was set at $35,000 per day.
What began as a commercial shipping transaction eventually developed into an international legal dispute involving unpaid freight, prolonged vessel delays and additional charges.
The London arbitration that preceded the US lawsuit
Norden, acting as the vessel’s disponent owner, initiated arbitration proceedings against Polaris Bank under the London Maritime Arbitrators Association on or around May 6, 2022.
The arbitration produced a final partial award on March 30, 2026, directing Polaris Bank to pay the original freight charge of $1,052,692.50.
The tribunal also awarded interest at five per cent per annum, compounded quarterly, from September 25, 2021, until the amount was paid.
According to the court records, Polaris Bank had made no payment towards the award when Norden subsequently approached the US court.
The freight award, however, represented only part of the financial dispute between the parties.
A much larger claim remained contested in the arbitration, involving $4,235,377.23 in additional charges. These included $1,553,261.11 in demurrage at the loading port, $1,985,404.17 at Lagos discharge, and $811,586.81 at Calabar discharge.
The claims also included additional freight, war-risk premiums, kidnap-related charges and loss-of-hire costs, after deducting a part payment of $400,000.
With the arbitration award unpaid, Norden turned to the United States, where Polaris Bank maintained funds through correspondent banking relationships.
How Polaris Bank’s money was frozen in New York
On June 22, 2026, Norden filed a lawsuit at the Southern District of New York seeking to attach Polaris Bank’s funds held by correspondent banks.
The shipping company named Citibank New York, Standard Chartered Bank New York and United Bank for Africa New York as garnishees, seeking to secure the money owed under the arbitration award.
Its application sought security of at least $1,052,692.50, representing the original freight award, and up to $5,288,069.73, alongside a further $712,833.52 in interest, costs and legal fees.
Three days after the filing, on June 25, the court granted an order of maritime attachment and garnishment against Polaris Bank.
The order authorised the United States Marshal to attach the bank’s property and credits held by Standard Chartered Bank in New York up to $6,001,000, with an overall limit of $6.4 million covering interest, costs and fees.
The court directed that the attached funds be held and not released without further judicial authorisation.
The order also extended to other banks within the district holding Polaris Bank’s funds as agents or intermediaries in money transfers.
The effect was that Polaris Bank’s money in the United States became subject to a court-controlled freeze while the dispute proceeded.
Months of extensions, but no defence filed
One of the most striking aspects of the case was Polaris Bank’s handling of the proceedings after the attachment order was issued.
Represented by Dentons in the United States, the bank obtained several extensions of the deadline to file its response.
The extensions were granted in July, August, September and October, with the final extension moving the deadline to November 11, 2026.
Despite the repeated extensions, Polaris Bank did not file an answer to Norden’s complaint.
Court records show that the only answer filed during the proceedings came from Standard Chartered Bank in New York, which submitted its response as garnishee on August 7, 2026.
The absence of a formal response from Polaris Bank meant that the case proceeded without the bank placing its defence to Norden’s claims on the court record.
However, the eventual settlement meant the dispute was resolved without a final determination of all the underlying claims through a contested trial.
Settlement reopened case and cleared the way for $6.21m payment
The proceedings took another turn in October after the court was informed that the parties had reached an agreement in principle to settle all claims.
On October 27, 2026, the court dismissed and discontinued the action, allowing the parties 30 days to seek its reopening if the proposed settlement was not completed.
A day later, on October 28, both sides jointly applied to reopen the case to facilitate the settlement, release the attached funds and lift the existing garnishment orders.
The court granted the request.
Its November 5 order subsequently provided the mechanism for completing the agreement.
Under the directive, Standard Chartered Bank in New York was required to transfer $6,214,196.08 to an account designated by Norden on or before November 12, 2026, and confirm receipt of the payment.
Once the transfer is completed, all attachments against Polaris Bank’s property and credits held by Standard Chartered and the other garnishee banks are to be lifted and vacated.
Standard Chartered is also discharged from its position as garnishee in the proceedings.
The case was dismissed with prejudice, meaning the claims resolved in the action cannot simply be brought again as the same lawsuit. Each party was directed to bear its own costs.
The order nevertheless preserved Norden’s right to attach Polaris Bank’s funds again if the bank failed to honour the settlement.
A $6.21m settlement and questions for Polaris Bank
The financial implications of the settlement are significant.
Norden’s original arbitration award was $1,052,692.50, excluding the interest that continued to accrue. The New York settlement, however, provides for a payment of $6,214,196.08.
The difference reflects the broader financial dispute and the settlement reached between the parties, rather than simply the original freight award.
The case also raises questions about Polaris Bank’s decision not to file an answer to the US lawsuit despite obtaining multiple extensions, particularly as its funds remained under attachment throughout the proceedings.
The underlying cargo transaction dates back to 2021, before Kayode Lawal’s tenure as head of Polaris Bank. However, the arbitration award, the New York litigation, the attachment of the bank’s funds and the eventual settlement all occurred in 2026.
