CBN Intervenes at First Bank, Dissolves Board

By Bashir Olanrewaju

The Central Bank of Nigeria intervened at the the country’s oldest bank by dissolving it’s board of directors of First Bank Nigeria Holding Company and reinstating key officials previously fired by the management.

The action of the banking regulator means the departure of Ibukun Awosika as chairman, who will be replaced by Remi Babalola, a former finance minister of state. The CBN reinstated Sola Adeduntan as managing director of First Bank, along with his deputy, Gbenga Shobo, as well as directors Remi Oni and Abdullahi Ibrahim. New board members were also appointed by the regulator.

CBN Governor Godwin Emefiele said the action was taken “to protect 31 million customers” as well as the minority shareholders of the bank. “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,” the central bank said in a statement on Twitter.

The CBN has earlier raised concerns about the bank’s corporate governance with its recent announcement of the removal of the managing director eight months before his tenure was to end. There was no report from the board indicting him or any allegations of misconduct, the regulator said in a query to First Bank earlier in the week.

“We are particularly concerned because the action is coming at a time the CBN has provided various regulatory forbearances and liquidity support to reposition the bank, which has enhanced its asset quality, capital adequacy and liquidity ratios amongst other prudential indicators,” it concluded.