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CBN Sacks Awosika, Otudeko,Other FBN Ltd, FBN Holdings Directors ..Reinstates Adeduntan as MD, Appoints New Directors

The Central Bank of Nigeria on Thursday evening sacked the Directors of First Bank Ltd and FBN Holding Company over allegations of insider dealing, bad credit decisions, poor corporate governance practices and failure to recapitalize to minimum standard.
Sola Adeduntan who was purportedly removed by the Board on Wednesday was reinstated by the CBN while his deputy who was announced as the new Managing Director was restored to his former position as Deputy Managing Director.
The Central Bank accused the former Board of unilaterally removing the Managing Director without its consent which is contrary to standard practice where the bank’s authority to effect changes in the management team is subject to CBN approval.
“It was therefore surprising to learn through media reports that the Board of Directors of FBN, a systemically important bank under regulatory forbearance regime had effected sweeping changes in executive management without engagement and/ or prior notice to the regulatory authorities,” the Governor said.

The apex bank while conveying the decision at the press briefing stated that “First Bank of Nigeria is one of Nigeria’s systemically important banks given its historical significance, balance sheet size, the large customer base, and high level of interconnectedness with other financial service providers.
Expatiating, he said, “By our last assessment FBN has over 31 million customers, with deposit base of N4.2 trn, shareholders’ funds of N618bn and NIBSS Instant Payment (NIP) processing capacity of 22% of the industry.”
According to the Governor, “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 also not divested its non- permissible holdings in non- financial entities in line with regulatory directives”
The Governor stated that the bank had maintained healthy operations until 2016 financial year after which “the CBN’s target examination revealed that the bank was in grave financial conditioning with its capital adequacy ratio (CAR) and non-performing loans ratio (NPL) substantially breaching acceptable prudential standards.”
With this intervention, the apex Bank reinstated Adeduntan as MD, with Gbenga Shobo as Deputy MD , Remi Oni, Abdullahi Ibrahim as Executive Directors while appointing Tokunbo Martins, Uche Nwokedi, Adekunle Sonola, Isioma Ogodazi, Ebenezer Olufowose, Ishaya Elijah B. Dodo as Directors. The CBN also named Tunde Hassan-Odukale as Chairman of the new Board sweeping away the likes of Oba Otudeko and Ibukun Awosika the erstwhile Chairman.
For the Holdings company the new Board is made up of Remi Bablola as Chairman, U.K Eke as Managing Directorwith Dr. Fatade Abiodun Oduwole , Kofo Dosekun, Remi Lasaki, Dr. Alimi Abdulrasaq, alhaji ahmed Modibbo, alhaji Khalifa Imam, Sir Peter Aliogo as Directors.

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