By Abiola Olawale
The internal tension and unease bedevilling Nigeria’s oldest financial institution, the First Bank, have continued to escalate as there has been a reported move among shareholders of First Bank of Nigeria Holdings Plc (FBN Holdings) to trigger a shake up in the leadership of the company’s Board.
This is as shareholders of First Bank Holdings Plc are said to be currently pushing for an extraordinary general meeting (EGM) in order to accomplish that goal.
The New Diplomat’s checks reveal that most stakeholders declared that the demand for the EGM is in line with section 2615 (1) of CAMA, in which case they have 21 days to call the EGM.
It was gathered that the key focus of the upcoming meeting is to discuss, and explore likely ways for the possible removal of Femi Otedola from his position as chairman, along with the potential removal of one Julius B. Omodayo-Owotuga from his role as a non-executive director.
The stakeholders explained that the demand for the EGM comes amidst concerns over governance and control issues within the bank.
They added that the call for this EGM is to address allegations that Otedola has exerted too much control over the bank since he emerged as Chairman, facilitated by the immediate past governor of Central Bank Governor (CBN), Godwin Emefiele, who is facing several corruption charges.
Critics among the shareholders have expressed concerns over corporate governance issues, fearing that with the proposed N360 billion private placement, Otedola could gain very strong control over the financial institution.
The shareholders also called for different methods of share issuance, such as a rights issue or public offer, rather than the private placement, to ensure broader shareholder participation and maintain corporate governance standards.
They declared that these issues are expected to be addressed during the Extraordinary General Meeting (EGM).
This situation is reflective of a broader power struggle within First Bank, where the battle for control among major shareholders has been ongoing, with figures like billionaire business mogul and one of Nigeria’s most legendary investors, Oba Otudeko, also significantly involved in the bank’s shareholding power dynamics.
This comes amid a legal tussle in the FBN Holdings. Otudeko had initiated a legal action against FBN Holdings, seeking a court order to compel the financial institution to recognise his investment vehicle, Barbican Capital, as the largest shareholder in the bank. If he succeeds, this would effectively block Otedola from gaining recognition as the largest single shareholder in First Bank Holdings.
Otudeko, in the lawsuit (no. FHC/L/CS/1172/24), claimed Barbican Capital owns a 15.01 per cent stake amounting to 5.38 billion units.
However, the bank insists that Otedola, who holds a 9.41 per cent share, is the largest shareholder.
First Bank argued that Barbican and Otudeko could not provide evidence of the purchase of some of the shares it claims to own.
According to court papers, First Bank further argued that Barbican is concealing the fact of an ongoing verification exercise by the Central Bank of Nigeria of its alleged significant shareholdings.
It noted that only 3.11 billion shares (representing 8.67 per cent) of Barbican Capital’s total shares could be verified by the CBN, while its alleged 2.34 billion shares (representing 6.52 per cent) could not be verified.
FBN Holdings and the CBN, both respondents to the lawsuit, have asked a Federal High Court sitting in Lagos to dismiss the suit filed by Barbican Capital over “the alleged alteration of its alleged 5,386,397,202 units of shares in the bank”.
In the meantime, the battle for the soul of First Bank, Nigeria’s oldest financial institution, rages in and out of the courtrooms.
