First Bank of Nigeria (FBN) Holdings has agreed to sell FBNQuest Merchant Bank Limited to EverQuest Acquisition LLP.

EverQuest Acquisition comprises Custodian Investments Plc, Aion Investments and Evercorp Industries.

In a statement on Friday signed by Adewale Arogundade, the acting company secretary, FBN Holdings said the completion of the sale is subject to approvals from the relevant regulatory authorities.

“In accordance with the Nigeria Exchange Limited (NGX) Rulebook, we hereby notify the Nigerian Exchange Limited (NGX) and the investing public that FBN Holdings Plc (“the Company”) has entered into a Share Sale and Purchase Agreement to divest its 100% equity stake in its wholly owned subsidiary, FBNQuest MerchantBank Limited,” the company said.

“This sale is in alignment with the Company’s strategy to optimise its portfolio within the Group.

“Following a competitive bid process, EverQuest Acquisition LLP (comprising Custodian Investments Plc, Aion Investments and Evercorp Industries) was selected as the preferred bidder.

“The completion of the sale is subject to approvals from the relevant regulatory authorities.”

The divestment comes amid a faceoff between FBN Holdings and one of its substantial investors, Barbican Capital Limited.

FBN Holdings and Barbican Capital are in court over an allegation by the investor that its shares in the company were altered.

The Chartered Institute of Bankers of Nigeria (CIBN) has asserted that the banking sector in the country is uniquely positioned to drive sustainable growth, foster innovation and ensure inclusivity across every stratum of society.

President and Chairman of Council, CIBN, Prof. Pius Olarewaju made the remark at weekend during the 2024 Lagos Bankers’ Night, themed: Driving National Growth Agenda: The Role of the Banking Sector,’ where he pointed out the vital role bankers play in elevating standards of the profession and advancing the broader goals of national development.

Olanrewaju, who is the 23rd President and Chairman of Council of the institute viewed that the annual Lagos Bankers’ Night is a cherished tradition that offers members a moment to reflect on the collective journey and opportunity to set the stage for future triumphs in the banking industry.

He said the theme was significant, as it serves as a powerful reminder of the role of banks in shaping the economic destiny of the nation. “As the backbone of the economy, the banking sector is uniquely positioned to drive sustainable growth, foster innovation and ensure inclusivity.”

Highlighting the place of the banks, he cited the National Bureau of Statistics report which says Nigeria’s financial services sector, contributed significantly to GDP annual growth rate of 2.98% recorded in the first quarter and 3.19% in the second quarter of 2024.

Olanrewaju viewed that the role of banks goes beyond traditional financial intermediation, adding, “we are the engines that power the wheels of commerce, the architects of financial innovation and the custodians of national wealth.”

He noted that the Central Bank of Nigeria report that Banks loans and support for the private sector rose to about N375 7th in the first five months of 2024, which is about 74 98 per cent higher than N214 76th recorded in the same period of the previous year, indicates that the banking sector has continued to provide increasing support for the economy.

The CIBN boss noted that the sector has a unique mandate to unlock the potential of our vast human and natural resources, to fuel entrepreneurship, and to ensure that financial opportunities reach every comer of the diverse society.

“We must harness the power of technology and remain steadfast in our commitment to ethical practices. The strategic direction of our industry must align with the broader goals of national development-creating jobs, supporting small and medium enterprises, driving industrialization, and enhancing the quality of life for all Nigerians.

“ It is through our collective efforts that we can transform challenges into opportunities and turn aspirations into realities. Our sector’s influence is vast, and with that influence comes the responsibility to act as catalysts for change and progress.

He noted that bankers were not just participants in the economy, “we are its architects. By leveraging our collective expertise, we can chart a course that leads to enduning prosperity for our country. When we perform our expected roles, the banking sector will contribute significantly to Nigeria’s economic growth that has already been projected by IMF to be around 3% by the end of 2024.”

Looking at the challenges confronting the economy like high inflation rate, infrastructural deficit among others, Olarewaju called for public private partnership relationship in this respect.

We need everyone to collaborate as only government cannot solve the problem on ground.

“There is no doubt the fact that today we have some economic challenges.

“But it’s not only government that can do it. There is a need for public-private partnership relationship in this respect.

“We are saying, every one of us, even including you journalists, you have a role to play. It’s not about banking alone.

We need support and encouragement from all stakeholders to achieve the growth agenda.

For the branch Chairman, CIBN, Lagos State, Adeyemo Adeoye, the event has become a perennial platform for networking amongst Bankers in (and outside Lagos state, financial industry leaders, key stakeholders in the Nigerian economy, captains of industries, and it has equally provided prime opportunity for exchange-of-ideas, while providing leverage for Corporate brand visibility and exposures.

He applauded the theme of the event, noting that the banking industry has traditionally played a significant role in economic developments.

“Because of the financial aggregation and intermediation functions of the banking systems, its roles are inextricably intertwined with the growth of the economy.”

Quoting Richard Branson, Adeoye said banking is the life blood of the economy, providing the financial oxygen that businesses and individuals need to breathe and grow.

To this end, he noted that “our banking industry will play significant roles in policy and growth direction of the economy and, this is inexorable.”

Prof Emmanuel Moore Abolo, Director General, The Economic Think-Tank Centre, also emphasised the need for collaboration to achieve the growth agenda.

“All the stakeholders in Nigeria need to come together to drive the national growth agenda by pulling all the forces together to one single direction called the vision training access and then everybody is able to contribute.”

He said the CBN needs to align the monetary policies with the fiscal which is key, create institutions, play its roles of intermediation, making sure resources are made available for implementation of all the strategic initiatives contained in the agenda.

“Here we try to bring in the banking sector. What can banks do to drive this growth. Our submission is that banks play the role of intimidation.

He also pointed out the need to create awareness among Nigerians to galvanise support to achieve success of the growth.”More fundamentally, we are talking about crafting a robust implementation. It’s one thing to have a plan and strategy, and it’s another thing to implement the strategy. So we are saying we need to awaken the soul of Nigerians, bring everybody on board and see how to push this agenda forward to support government to be able to implement the agenda , if not 100 percent at least 80 percent of the plan.”

To him creating awareness for Nigerians is an important factor “as about 80 percent of Nigerians are not aware that we have an agenda, the awareness is important to get the support needed . So all can work together to drive the implementation of the growth agenda.”

Sterling Bank Limited has again demonstrated its commitment to driving economic growth through MSME financing, by clinching three prestigious awards at the fourth Development Bank of Nigeria (DBN) Service Ambassadors Award Ceremony.

The event held in Lagos, designed to strengthen partnerships between DBN and Participating Financial Institutions (PFIs), recognized Sterling Bank’s outstanding contributions in key areas of impact.

The bank emerged victorious in three categories: DMB with the Highest Impact on Youth, DMB with the Highest Impact on Women MSMEs, and the coveted DBN Platinum Service Award.

The latter, being the highest honor of the evening, comes with a N5 million technical assistance grant to further bolster the bank’s efforts in supporting small businesses.

Sterling Bank’s triple win underscores its dedication to fostering entrepreneurship and economic empowerment across diverse segments of society. By focusing on youth and women-led MSMEs, the bank has shown its commitment to inclusive growth and development in Nigeria’s business landscape.

Speaking on the achievement, the Divisional head, Retail & Consumer Banking at Sterling Bank, Edward Ogunmekan expressed pride in the recognition, stating that, “these awards are a testament to Sterling Bank’s unwavering commitment to empowering Nigerian entrepreneurs, particularly youth and women.

“We believe that by supporting MSMEs, we are not just growing businesses, but building the foundation for a more robust and inclusive economy. This recognition from DBN further motivates us to intensify our efforts in driving sustainable economic growth through strategic financing initiatives.”

The DBN Service Ambassadors Award Ceremony serves as a platform to acknowledge and encourage financial institutions that have made significant strides in channeling funds to MSMEs, thereby contributing to job creation and economic diversification.

Sterling Bank’s impressive performance at this year’s event highlights its role as a key player in Nigeria’s financial sector and its positive impact on the country’s entrepreneurial ecosystem.

Sterling Bank stated that with these accolades, it is poised to leverage the additional technical assistance from the Platinum Service Award to enhance its MSME support programs further, promising even greater impact in the coming years.

The Central Bank of Nigeria’s (CBN) has disclosed currency outside the banking system dropped to N3.66 trillion in July, inferring that its ongoing efforts to tighten liquidity and encourage formal banking deposits are showing promising results.

The development marks the second significant decline this year, reflecting a shift in public behavior towards increased reliance on banking institutions.

The figure represents a 3.32 per cent drop (N130 billion) from June’s N3.79 trillion; a sharper decrease compared to the modest 0.62 per cent (N20 billion) reduction recorded between March and April. The trend suggests that Nigerians are increasingly opting to deposit their money in banks rather than keeping it in cash.

Interestingly, while currency outside banks decreased, the total currency in circulation experienced a slight uptick, rising to N4.05 trillion; a modest increase of just 0.12 per cent. This indicates a stabilization in cash usage across the economy, which financial experts attribute to the growing adoption of digital transactions and regulatory measures effectively managing cash flow.

Financial analysts have noted the importance of this development. The decline in the percentage of currency outside banks, from 93.59 per cent in June to 90.39 per cent in July, signals a significant change in how money is being held, with more individuals and businesses moving towards formal banking channels. This shift is seen as crucial for enhancing financial inclusion and enabling the CBN to exercise greater control over monetary policy.

“This movement towards formal banking is a critical development,” financial experts explained. “It provides the CBN with better tools to manage the economy, particularly in terms of controlling inflation and fostering overall economic stability.”

The reduction in currency outside the banking system also aligns with a slight decrease in Nigeria’s headline inflation rate, which dropped to 33.40 per cent in July from 34.19 per cent in June. This marks the first decline in the inflation rate since December 2022, suggesting that the CBN’s monetary policies may be beginning to curb inflation and stabilise the economy.

As the CBN continues to implement strategies aimed at promoting economic stability and encouraging Nigerians to embrace formal banking, these positive trends could signal a broader transformation in the nation’s financial landscape, with potential long-term benefits for economic growth and stability.

The Central Bank of Nigeria (CBN) on Monday, made significant adjustments to its monetary policy to manage liquidity and address inflationary pressures.

Following the 296th Monetary Policy Committee (MPC) meeting, the CBN increased the rates for the Standing Deposit Facility (SDF) to 25.75% and the Standing Lending Facility (SLF) to 31.75%.

In a circular signed by its Director Financial Market Department, Dr. Omolara Duke, also said that commercial and merchant banks would earn a 19% interest rate on deposits above N3 billion in its Standing Deposit Facility (SDF).

There is also 19% interest on deposits above N1.5 billion for Payment Service Bank (PSB).

The CBN has also lifted the suspension of the standing deposit facility for banks in the country and fixed interest on their deposits between 19 and 25.75 percent.

At its last meeting in July, the MPC had raised the monetary policy rate by 50 basis points to 26.75 per cent from 26.25 per cent and adjusted the asymmetric corridor around the MPR to +500/-100 from +100/- 300 basis points, whilst leaving other parameters unchanged.

Explaining the reason behind the SLF rate, the apex bank said, “The Monetary Policy Committee (MPC) adjusted the upper corridor of the standing facilities to 5.00% from 1.00% around the MPR, at its 296th meeting.

Consequently, the suspension of the Standing Lending Facility (SLF) is hereby lifted and Authorised Dealers should send their request for SLF through the Scripless Securities Settlement System (S4) within the operating hours of 5.00pm to 6.30pm.

“To this end, Authorised Dealers are permitted to access the SLF at 31.75%; Permitted to access Intraday Lending Facility (ILF) to avoid system gridlock at no cost if repaid the same day;

The 5.00% penalty (as stated in the S4 business rules) is retained, for participants that do not settle their ILF, which the system will convert to SLF at 36.75%;

Collateral execution (the rediscounting of instruments pledged by participants at the penal rate by CBN) is reintroduced as stipulated in the approved repo guidelines. The circular takes immediate effect.”

Reacting to the development, financial experts stated that the CBN’s latest adjustments are expected to have broad implications for the banking sector.

They noted that by raising both SLF and SDF rates, the central bank aims to curb excess liquidity, which is often a precursor to inflation.

The reduction in interest rates for excess deposits is also intended to push banks toward more active lending rather than merely holding funds at the CBN.

The changes are likely to impact the cost of funds for banks, influencing the interest rates offered to customers for both loans and deposits.

“While tighter liquidity conditions may lead to higher lending rates and potentially slower credit growth in the short term, the move could help stabilize inflation over time.

The increase in the SLF rate means that banks looking to borrow money from the central bank to cover short-term liquidity positions will now face higher interest costs,” they said.

Shareholders of First Bank of Nigeria (FBN) Holdings, Nigeria’s oldest financial institution, are growing increasingly anxious as recent crises and scandals have caused the company’s share price to plummet by over 50% in five months, according to POLITICS NIGERIA.

FBN Holdings, which traded at ₦43.95 per share on March 19, has seen its share price fall to ₦20.35 as of Wednesday, according to data from the Nigerian Securities Exchange (NGX).

This dramatic decline is largely attributed to a series of controversies that have embroiled the company’s management and operations in recent months.

Asides the controversies surrounding the ownership of its controlling stake, a litany of court cases pending determination and a fraud case that led to the dismissal of over a hundred staff have raised concerns for investors holding the bank’s shares, sources confided in this newspaper.

Recapitalisation Stalled

These developments have cast a cloud of uncertainty on the bank’s recapitalisation plans as many of its competitors have completed a fresh capital raise in line with the standard set by the Central Bank of Nigeria (CBN).

Recall that the Apex bank, under a new threshold released in March, stated that commercial banks with international authorization must have at least 500 billion naira, leaving banks with two years to meet the new standard.

FBN Holdings, although announced plans to raise some N300 billion through issuance of shares via a public offering in April, the Annual General Meeting (AGM) which is meant to approve it, is yet to take place.

A Lagos Federal High Court halted an AGM initially scheduled for August 22. The meeting is now postponed till September 3, according to a notice published on the NGX.

Investors are worried that these ongoing issues could lead to a further decline in the bank’s fortunes.

“These are the kind of issues that led to the fall of Skye Bank. If care is not taken, many local and foreign investors will pull out,” said an investor who has held shares in the company since 1995. He added, “The troubles are piling up day by day and it seems there is no end in sight. It is even difficult to hold an ordinary Annual General Meeting, not to mention raising capital.”

Ownership Dispute

The ongoing dispute over the ownership of FBN Holdings’ controlling stake has been a major cause of concern for investors. In December 2021, billionaire Femi Otedola became the company’s single largest shareholder.

However, he was soon displaced by Barbican Capital Limited, a company owned by Oba Otudeko, which now claims to hold a 15.01% stake in the company.

Barbican Capital has filed a lawsuit against FBN Holdings, challenging the reduction of its shareholding from 13.61% in December 2023 to 8.67%. The company submitted evidence from the Central Securities Clearing System (CSCS) to support its claim, showing that it actually owns 5.39 billion shares, representing 15.01% of the lender’s total shares.

This ownership dispute, along with the legal battles surrounding it, has further destabilised investor confidence.

‘Illegal’ 2023 AGM

Despite a court order prohibiting FBN Holdings in 2023, the bank proceeded with the meeting and this has resulted in multiple lawsuits filed by aggrieved shareholders.

One of the plaintiffs, Kujenya Olayiwola Yusuf, prayed the court to nullify all decisions made during the August 223 AGM, including the registration of the new share capital.

In another case related to the controversial AGM, a minority shareholder Yetunde Olowoyeye, argued that all the resolutions passed during the AGM are null and void, having been forged in the fires of judicial contempt.

The outcome of these cases, some shareholders say, will impact on the future of the company as a reversal of the decisions made at the AGM could set the bank on a path of collapse.

40 billion Fraud

While there is so much going on in the FBN Holding board room, the banking hall is also not spared of scandals. The bank sacked at least 120 employees after discovering a ₦40bn fraud, Tech Cabal reported in August.

Tijani Muiz Adeyinka, a manager on the operations team who reportedly diverted ₦40 billion over two years, has been on the run for weeks after his heist was discovered in May. The employees dismissed were accused of laxity in carrying out their duties and were told they should have spotted the fraud earlier.

The Tech Cabal report added; “Several employees were questioned by the Nigerian Police Force (NPF) and detained at the Lion’s Building for at least six hours, one person with direct knowledge of the incident said. Those employees needed to post bail before they were released. Restrictions have been placed on all their personal accounts except their First Bank accounts. “

Meanwhile, Lagos-based banking and finance consultant, Hakeem Morakinyo, told POLITICS NIGERIA that FBN Holdings is in a precarious position as these crises continue to unfold.

“The coming weeks will be critical in determining whether the bank can resolve its internal conflicts and restore investor confidence or if it will follow the same path as other failed institutions,” he said.