Board Crisis: CBN May Takeover First Bank to Avoid Collapse – Stakeholders

Spread the love

By Reporter

*Sleeping Giant: Ben Enwonwu’s illustration of First Bank (©Enwonwu)*

Worried shareholders of First Bank Plc have raised an early alarm over the ongoing crisis at FBN Holdings Plc, the parent company of the bank stating that unresolved “corporate governance and strategic disputes,” over the control of the bank, could lead to insolvency and its collapse.

They have therefore called for the intervention of the regulatory agencies to avoid significant financial losses for investors.

The group, ‘New Dimension Shareholders Association’ spoke through the Chairman, Mr. Patrick Ajudua, and stressed the urgency of regulatory action during a media brief.

“The regulator owes it a duty to ensure that rules and laws are strictly followed in resolving the various contending issues currently rocking FBN Holdings Plc.

“Failure to do so may lead to the collapse of the bank, eventually resulting in a regulatory takeover and the loss of our investment,” the group stated.

FBN Holdings Plc, one of Nigeria’s oldest and largest financial institutions, has been facing mounting corporate governance challenges, “.. since Mr. Femi Otedola assumed the chairmanship position and this have eroded investor confidence and raised concerns about its long-term stability.”

Earlier, a group of shareholders holding 10 per cent of the company’s shares on Wednesday formally requested an Extraordinary General Meeting, citing Section 215(1) of the Companies and Allied Matters Act (CAMA). Among the agenda items are calls for the removal of Group Chairman Mr. Femi Otedola and Mr. Julius B. Omodayo-Owotuga, a non-executive director.

The shareholders alleged that Otedola’s emergence as chairman was facilitated by former Central Bank of Nigeria Governor Godwin Emefiele, who reportedly supported Otedola’s acquisition of substantial shares.

They further alleged that, the development has since disrupted the bank’s corporate governance structure, leading to instability and executive conflicts.

Other accusations include the dismissal of former CEO Dr. Adesola Adeduntan, the sidelining of Tunde Hassan-Odukale, and the alleged bypassing of top-performing candidates for key leadership positions.

But responding last Thursday, FBN Holdings Plc through a statement assured stakeholders that the ongoing disputes will not impact on the bank’s operations.

The statement stressed on its commitment to corporate governance and pointed to the improved financial performance and a growing market capitalization.

“This matter does not in any way impact the operations of the company, and all businesses within the group continue to provide uninterrupted services to customers.

“We are taking all necessary steps to protect the interests of the company and its subsidiaries,” First Bank reassured.

The crisis has prompted calls for decisive intervention from the Central Bank of Nigeria and the Securities and Exchange Commission. Shareholders have urged regulators to enforce compliance, resolve disputes, and ensure the bank’s stability in the interest of Nigeria’s financial system.

“We have continuously advocated for all stakeholders to prioritize the bank’s survival above personal interests and ensure amicable resolutions,” the New Dimension Shareholders chairman, Ajudua said.

Stakeholders are optimistic that the regulatory authorities will act swiftly to restore stability and investors confidence by enforcing the principles of corporate governance in one of Nigeria’s financial institutions.