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CBN Reverses Changes In First Bank’s Mgt On Illegality Grounds

Barely 24 hours after the Board of the First Bank of Nigeria (FBN) effected major changes in the lender’s top management, the Central Bank of Nigeria (CBN) on Thursday announced the immediate removal of all the directors of the bank and its parent company, FBN Holdings Plc, over the board’s non-compliance with regulatory guidelines on its decision.

The CBN Governor, Mr Godwin Emeifele in a statement titled ‘The Purported Management Change at the First Bank of Nigeria Ltd.’ announced the appointment of Mr Remi Babalola as the Chairman of FBN Holdings.

Others, including Dr Fatade Oluwole, Kofo Dosekun, Remi Lasaki, Dr Alimi Abdulrasaq, Ahmed Modibbo ,Khalifa Imam and Sir Peter Aliogo, were also announced into the FBN Holdings’ board as directors.

While announcing the monetary authorities’ approval of Mr Tunde Hassan-Odukale as First Bank Chairman, Dr Sola Adeduntan was reatined as the bank’s Managing Director, Mr Gbenga Shobo as the Deputy Managing Director. Mr Remi Oni and Abdullahi Ibrahim were announced as Executive Directors.

Other directors announced by the CBN Governor are Tokunbo Martins, Uche Nwokedi , Adekunle Sonola, Isioma Ogodazi, Ebenezer Olufowose and Ishaya Elijah Dodo.
Emefiele stated that the management of the CBN, in line with its powers under BOFIA 2020 approved and took the action following a review of the situation and in order to preserve stability of the bank to protect minority shareholders and depositors.

He clarified: “As you may be aware, FBN is one of the systemically important banks in the Nigerian banking sector given its historical significance, balance sheet size, large customer base and high level of interconnectedness with other financial service providers, amongst others.

“By our last assessment, FBN has over 31million customers, with deposit base of N4.2 trillion, shareholders funds of N618 billion and NIBSS instant payment (NIP) processing capacity of 22 per cent of the industry.

“To us at the CBN, not only is it imperative to protect the minority shareholders, that have no voice to air their views, also important, is the protection of the over 31million customers of the bank who see FBN as a safe haven for their hard-earned savings”, the industry regulator added.

It would be recalled that the CBN had earlier queried the Mrs. Mrs. Ibukun Awosika-led board for removing Dr Adesola Adeduntan as the Managing Director/CEO without regulatory approval.

The query was conveyed in a letter dated April 28, 2021 signed by the CBN Director, Banking Supervision, Mr Haruna Mustafa.

Mustafa noted that the removal of a sitting MD/CEO of a systemically important bank was not good.

He stated: “The removal of a sitting MD/CEO of a systemically important bank that has been under regulatory forbearance for five to six years without prior consultation and justifiable basis has dire implications for the bank and also portends significant risks to the stability of the financial system.

“In light of the foregoing, you are required to explain why disciplinary action should not be taken against the board for hastily removing the MD/CEO and failing to give prior notice to the CBN before announcing the management change in the media.

“In the meantime, you are directed to desist forthwith from making any further public/media comments on the matter. Your comprehensive response on the foregoing should reach the Director, Banking Supervision Department, on or before 5p.m. on April 29, 2021”, he added.

Earlier on Wednesday, the bank’s board had announced sweeping changes in the management structure with the announcement of Mr. Gbenga Shobo, currently Deputy Managing Director, as the lender’s Managing Director/CEO designate of the bank while Mr. Abdullahi Ibrahim, took over the Deputy Managing Director’s office.

A statement by the bank indicated that Shobo succeeded Sola Adeduntan, who will be leaving the bank after serving in the position since January 2016 and that decisions will take effect from Wednesday, 28 April 2021.

Also, the board appointed Abdullahi lbrahim as Deputy Managing Director, while Messrs Ini Ebong, Segun Alebiosu, and Seyi Oyefeso and Mrs. Bashirat Odunewu were also appointed as Executive Directors.

While announcing the appointments, the bank’s Chairman, Mrs. Ibukun Awosika, said: “We are proud to announce Gbenga Shobo as our new MD/CEO. His appointment has proven the resilience of our succession planning mechanisms and the value we place on our long-standing corporate governance practices, which underpin the institution’s enduring sustainability and 127-year legacy

“Gbenga has had a successful career in the Bank and elsewhere, culminating in his appointment as Deputy Managing Director (DMD), in 2016 Prior to his appointment as DMD, he was the Executive Director overseeing the Retail Banking/Public Sector businesses in the Lagos & West Directorate and was hitherto the Executive Director overseeing the Retail Business in the South Directorate.

“As part of his responsibility for Retail Banking, he has been instrumental in developing and growing the bank’s Agency banking business, which today, is the market leader in Agency Banking. Leveraging partnerships and best-in-class technology and bringing banking services to millions of unbanked and underbanked customers in Nigeria and across various countries where we operate through our African subsidiaries.

“The Board is confident that Gbenga has the experience and understanding of the bank and the know-how to lead the Bank through this next phase of growth, which is focused on positioning First Bank as the pre-eminent bank in our chosen markets, delivering value to our stakeholders.

“I would like to thank Sola for his dedication and efforts during his helm at the Bank, and before as CFO. The board and I are grateful for his leadership of the bank over the last 5 and a half years and believe that the strong foundations created during his term will provide an excellent basis for our continued success. We wish him well in his future endeavors outside the FirstBank Group”, Awosika added.

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