•Declares bank’s operations unhampered
Obinna Chima
Following his restatement by the Central Bank of Nigeria (CBN), Dr. Adesola Adeduntan yesterday officially returned to his position as the Managing Director/Chief Executive Officer of First Bank of Nigeria Limited.
The bank, in a statement signed by its Group Head, Marketing and Corporate Communications, Folake Ani-Mumuney, confirmed Adeduntan’s resumption, stating further that the bank has accepted the board changes effected by the CBN.
The CBN had last Thursday removed all directors of First Bank Nigeria Limited and those of its parent company, FBN Holdings Plc to stave off a boardroom crisis that led to the short-lived retirement of Adeduntan, on Wednesday. The CBN Governor, Mr. Godwin Emefiele, subsequently announced the reinstatement of the bank’s CEO.
The bank, in a statement issued to announce the resumption of Adeduntan, reassured depositors and shareholders of the safety of their funds and investment.
The statement said: “Dr. Adesola Adeduntan has since resumed work as CEO in line with the directives of the CBN. We can confirm that the bank is cooperating with the CBN and other regulators while the operations of the bank are not hampered or hindered in any way and are in fact running smoothly.
“We further wish to reassure the public, our esteemed customers and stakeholders in the words of the Governor of the CBN in concluding his press conference, ‘The CBN hereby reassures the depositors, creditors and other stakeholders of the bank of its commitment to ensuring the stability of the financial system. There is therefore no cause for panic amongst the banking public, given that the actions being taken are meant to strengthen the bank and position it as a banking industry giant.’”
Emefiele last Thursday explained that the CBN begged the board members of First Bank severally not to remove Adeduntan but the pleas were ignored.
He said: “This decision (to remove Adeduntan) came to us as a surprise. This bank has been under regulatory forbearance intervention since 2016.”
The CBN boss stressed that given the apex bank’s regulatory intervention and forbearance regime, it felt that if there was any misconduct on the part of Adeduntan, he should have been queried.
He said the CBN should have been informed and the apex bank should have been a party to such an action to punish Adeduntan.
“We were not informed of any misconduct, neither were we informed of any query,” the CBN’s helmsman stated.
Emefiele noted that indeed, the CBN had been satisfied working with Adeduntan on a stabilisation regime for First Bank since 2016.
He said Adeduntan had played his role to the best of CBN’s knowledge and the best that could be done of a professional banker.
The CBN boss went further to state that Adeduntan had insisted on best governance being put in place, adding that the apex bank had the suspicion that Adeduntan was removed because he took decisions that did not favour major shareholders
Last Thursday, Emefiele announced the appointment of a former Minister of State for Finance and former Executive Director of First Bank, Mr. Remi Babalola, as chairman of FBN Holdings. He took over from Mr. Oba Otudeko who was sacked by the banking sector regulator.
Other new directors on the FBN Holdings’ board are Fatade Oluwole, Kofo Dosekun, Remi Lasaki, Alimi Abdulrasaq, Ahmed Modibbo, Khalifa Imam and Peter Aliogo.
Mr. UK Eke retained his position as Managing Director of FBN Holdings.
First Bank Nigeria Limited’s new Chairman is Tunde Hassan-Odukale, who replaced Mrs. Ibukun Awosika. Other board members are Tokunbo Martins, Uche Nwokedi, Adekunle Sonola, Isioma Ogodazi, Ebenezer Olufowose, Ishaya Elijah B. Dodo and Adeduntan. Gbenga Shobo, deputy managing director; and Remi Oni and Abdullahi Ibrahim, executive directors, are members of the reconstituted board.
Emefiele told journalists that with the changes, the bank must assume its leadership position in the industry, adding that the central bank would be looking into allegations of insider abuse in the bank and would ensure that corporate governance was restored.
According to him, the CBN will insist on proper re-capitalisation of the bank to restore its capital adequacy ratio.
He stated that the CBN took the action because it considered itself a stakeholder in management changes involving First Bank due to the forbearance and its close monitoring of the bank over the last five years.
The CBN boss stated that FBN was one of the systemically important banks in the Nigerian banking sector given its historical significance, balance sheet size, large customer base and high level of interconnectedness with other financial service providers, amongst others.
“By our last assessment, FBN has over 31 million customers, with deposit base of N4.2 trillion, shareholders’ funds of N618 billion and NIBSS instant payment processing capacity of 22 per cent of the industry,” Emefiele said.
He added, “To us at the CBN, not only is it imperative to protect the minority shareholders that have no voice to air their views, also important, is the protection of the over 31 million customers of the bank who see FBN as a safe haven for their hard-earned savings.”
He observed that the bank maintained healthy operations up until 2016 financial year when the CBN’s target examination revealed that the bank was in grave financial condition with its capital adequacy ratio and non-performing loans ratio substantially breaching acceptable prudential standards.
Emefiele said the problems at the bank were attributable to bad credit decisions, significant and non-performing insider loans and poor corporate governance practices.
He said the shareholders of the bank and FBN Holding Plc also lacked the capacity to recapitalise the bank to minimum requirements, adding that these conclusions arose from various entreaties by the CBN to them to recapitalise.
Emefiele said the CBN stepped in to stabilise the bank in its quest to maintain financial stability, especially given FBN’s systemic importance.
