CBN sacks Awosika, other Board members of FBN, reinstate Adeduntan

The governor of the Central Bank of Nigeria, Godwin Emefiele, in the early evening of Thursday, April 29, sacked the entire members of the board of First Bank Holding and First Bank Nigeria Ltd.

The sack was announced on live television, covered by Arise TV and other news channels.

Emefiele, in his speech, cited insider abuse, insider credit and breakdown of corporate governance as the reason behind the apex bank’s move.

The CBN governor further went ahead to announce that Dr Sola Adeduntan had been reinstated as the Managing Director of the interim Board.

Recall that the CBN had earlier queried First Bank, expressing concern that the appointment of Gbenga Shobo as MD/CEO was done without the approval of the apex bank.

The CBN also claimed that the tenure of the ousted Dr Adesola Adedutan was yet to expire and as such, there was no justification for his removal.

In the press briefing on Thursday evening, Mr Emefiele stated that the apex bank had been keeping close tabs on First Bank Nigeria over the past 5 years having discovered that the bank was in “grave financial condition with its capital adequacy ratio (CAR) and non-performing loans ratio (NPL) substantially breaching acceptable prudential standards.

In his words, “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.”

Following the latest action of the Board of FBN Ltd in ousting Dr Adeduntan and replacing him with his deputy, Mr Gbenga Shobo outside of the apex bank’s consent, the CBN took the decision to issue all members of the Board of FBN Ltd and FBN Holding company, a red card, naming an interim Board headed by the now reinstated Dr Adeduntan.