The Central Bank of Nigeria (CBN) has directed the immediate removal of all Directors of First Bank of Nigeria (FBN) Limited and FBN Holdings Plc.
The CBN Governor, Emefiele, said First Bank of Nigeria is one of Nigeria’s systemically important banks given its historical significance, balance sheet size, large customer base and high level of interconnectedness with other financial service providers, but that did not stop the CBN to take regulatory actions as required.
CBN reassures First Bank of Nigeria depositors, creditors and other stakeholders of the bank of its commitment to ensure the stability of the financial system. Emefiele said CBN acted to protect 31 million customers and minority shareholders of First Bank of Nigeria Ltd.
Why CBN removed all directors of CBN
CBN majorly removed all directors of First Bank of Nigeria (FBN) Limited and FBN Holdings Plc because of insider borrower and investments in non-financial entities.
Official Reason released by CBN
“The insiders who took loans in the bank, with controlling influence on the board of directors, failed to adhere to the terms for the restructuring of their credit facilities which contributed to the poor financial state of the bank. The CBN’s recent target examination as at December 31, 2020 revealed that insider loans were materially non-compliant with restructure terms (e.g. non perfection of lien on shares/collateral arrangements) for over 3 years despite several regulatory reminders. The bank has not also divested its non-permissible holdings in non-financial entities in line with regulatory directives,” Emefiele revealed.
New Management of FBN
CBN subsequently approved the appointment of Remi Babalola as Chairman FBN Holdings Plc, Dr. Fatade Abiodun Oluwole, Kofo Dosekun, Remi Lasaki, Dr Alimi Abdulrasaq, Ahmed Modibbo, Khalifa Imam, Sir Peter Aliogo, and UK Eke (Managing Director) as Directors of FBN Holdings Plc.
CBN also approved the appointment of Tunde Hassan-Odukale as Chairman of First Bank of Nigeria Limited. Tokunbo Martins, Uche Nwokedi, Adekunle Sonola, Isioma Ogodazi, Ebenezer Olufowose, Ishaya Elijah B. Dodo as Directors of First Bank of Nigeria.
CBN then reinstated Sola Adeduntan as Managing Director; Gbenga Shobo as Deputy Managing Director; and Remi Oni and Abdullahi Ibrahim as Executive Directors of First Bank of Nigeria Limited.