News Highlights

Aftermath of the action of Oba Otudeko and Mrs. Ibukun Awosika

The ruckus may have settled after the reinstatement of the MD/CEO of First Bank of Nigeria, Dr. Adesola Adeduntan and the sack of the boards of First Bank of Nigeria and the First Bank of Nigeria Holdings but shareholders are now realizing that this strategic move by the Central Bank of Nigeria was beneficial. The actions of Oba Otudeko and Mrs. Ibukun Awosika brought First Bank to the brink of imminent collapse and Emefiele and the CBN’s management may have prevented this from happening.

CBN had, in previous times, overlooked the excesses of the First Bank of Nigeria board members and this may have given Otudeko and his ilk the opportunity to secure huge insider loans with grossly inadequate assets as collaterals which is against banking ethics. These non-performing loans (NPLs) were often understating in the financial statements so as not to arouse suspicion.

A report by Debtors Africa published in 2019 succinctly addresses this when it stated that  “The poor repayment culture of large debtors who tend to prove more recalcitrant than their smaller counterparts has given birth to a burgeoning debt factoring and loan repurchase business. To be sure, analysts have argued that private debt factors and loan purchasers are the natural successors to the AMCON after the completion of its sunset period scheduled for June 2020. The opinion of some reviewers of the local loan industry landscape is that the application of private, incentive-based recovery models would prove more effective than the AMCON-supervised arrangement that still has to resolve N5trn of outstanding bank assets”.   

This revelation by CBN ultimately means that First Bank of Nigeria and the First Bank of Nigeria Holdings may be worthmuch less than their most recent market prices.  This is the stark realities that the shareholders must face. All this is due to the actions of a few unscrupulous individuals.

The action of Oba Otudeko and Mrs. Ibukun Awosika has exposed the lapses in the Nigerian banking system and has caused trepidation in the sector now that the integrity of the industry has been called to question. 

It now behooves on, not just the CBN but, every player in the banking sector that what happened in First Bank is an aberration and will not be allowed to happen again.

Leave a Reply

Your email address will not be published. Required fields are marked *

Related posts
News Highlights

Central Bank of Nigeria exposes the rot in the financial sector

The Central Bank of Nigeria recently beamed its searchlight on the activities of the members of the…
Read more
News Highlights

Ecobank’s Suit against Mr. Oba Otudeko

Ecobank Nigeria Limited filed a court case against Mr. Oba Otudeko, the chairman of Honeywell Group.
Read more
News Highlights

Mr. Oba Otudeko Affected in the sack of First Bank of Nigeria Holdings Board of Directors

The Central BankofNigeria recentlysackedMr. Oba Otudekoas Chairman of First…
Read more
Newsletter
Get News first!

Sign up for Horus Blog's Daily Digest and get the best of Horus Blog, tailored for you.