Banking Sector

Ecobank Demands Rejection of FBN Holdings Acquisition Over Alleged Unsettled Debt

The demand stems from an alleged unsettled debt of N13.5 billion Otudeko owed Ecobank Nigeria Limited.

Published

3 months ago

July 11, 2023

Ecobank Nigeria Limited has called for the rejection of the recent acquisition of FBN Holdings shares by an entity associated with Oba Otudeko, the former chairman of the banking group.

The demand stems from an alleged unsettled debt of N13.5 billion Otudeko owed Ecobank Nigeria Limited.

Kunle Ogunba, Ecobank’s lawyer, accused Otudeko of diverting assets belonging to both himself and the Honeywell Group of Companies through Barbican Capital Limited in other frustrate the enforcement of a Supreme Court judgment against him and the Honeywell companies.

This development follows Otudeko’s comeback, wherein he acquired a 13.3 percent stake in FBN Holdings by purchasing 4.7 billion shares valued at N87.8 billion through Barbican.

In the letter dated July 7, 2023, Ecobank’s lawyer asserted, “We, therefore, demand that you respectfully reject the approval/consent/registration/ratification [of] the shares bought by the said Barbican Capital Limited held via the afforested entities, as proceeding with such approval/registration will be tantamount to assisting in the diversion of funds/assets meant for the payment of the debt which has been affirmed by the Supreme Court.”

The letter further demanded that FBN Holdings provide details regarding the status of the transaction within seven days.

Ecobank emphasized that as a responsible corporate entity, FBN Holdings should not take any action that might be construed as encouraging the subversion or violation of the Supreme Court’s judgment, which mandates the Honeywell companies to repay their outstanding debt.

In January, the Supreme Court upheld an earlier judgment by the Court of Appeal, ruling in favor of Ecobank in a debt dispute with Honeywell Flour Mills Plc and two other firms. The case revolved around an unsettled debt of N5.5 billion.

Justice Emmanuel Agim, delivering the lead judgment, found in favor of Ecobank on two out of three issues identified.

He criticized the Court of Appeal for holding that the appellants lacked the locus standi to institute the suit at the Federal High Court and for claiming that the trial court lacked jurisdiction.

The three firms, namely Honeywell, Anchorage, and Siloam, had sued Ecobank in August 2015, seeking a declaration that they had no further debt obligations to Ecobank after paying N3.5 billion of the N5.5 billion debt. They also requested the court to compel Ecobank to update their status on the “Credit Risk Management System Portal of the Central Bank of Nigeria.”

Ecobank countered by stating that a repayment agreement had been reached in July 2013, whereby N3.5 billion was to be settled within six months. The bank rejected Honeywell’s request to extend the repayment period over one and a half years.

According to Ecobank, the debt repayment agreement had expired in August 2013.

The ongoing dispute between Ecobank and the Honeywell companies, as well as the alleged diversion of assets by Oba Otudeko, has cast a cloud over the recent acquisition of FBN Holdings shares. The coming days will shed light on how FBN Holdings will respond to Ecobank’s demands and address the concerns raised regarding the alleged unsettled debt.

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Banking Sector

Access Bank, Others Collect N154 Billion in Electronic Banking Fees in H1’23, a 16.7% YoY Surge

Published

3 days ago

September 28, 2023

Samed Olukoya

In the first half of 2023, customers of Nigeria’s top nine commercial banks paid a whopping N154 billion in fees for utilizing electronic banking services, reflecting a robust 16.7% year-on-year increase compared to H1’22’s N131.97 billion.

The data, extracted from the financial statements of these banks, underscores the escalating trend of Nigerians embracing electronic payment channels.

Leading the pack in revenue generation from these fees is Access Bank, amassing N43.9 billion, followed by United Bank for Africa Plc (N51.07 billion), Zenith Bank (N22.27 billion), Guaranty Trust Bank (N21.2 billion), and others like Stanbic IBTC (N2.14 billion), First City Monument Bank (N7.4 billion), Unity Bank (N1.96 billion), Fidelity Bank (N1.85 billion), and Wema Bank (N3.13 billion).

Electronic banking services encompass a gamut of options, including internet banking, mobile banking, ATMs, and Point of Sale (PoS) systems.

Recent data from the Nigerian Interbank Settlement System (NIBSS) for Q1’23 indicates a substantial surge in electronic transactions.

Transaction volume increased by 209% YoY to 4.7 billion, and transaction value grew by 48% YoY to N137.52 trillion.

The nine banks collectively raked in N66.7 billion in account maintenance fees and commissions during H1’23, reflecting a 14.7% YoY rise.

Zenith Bank led this category with N21.02 billion, trailed by Access Bank (N13.36 billion), Guaranty Trust Bank (N10.5 billion), and United Bank of Africa (N9.6 billion).

Overall, the banks’ cumulative net fees and commission income registered a substantial 20.7% YoY growth, reaching N448.47 billion in H1’23 from N371.43 billion in H1’22.

Banking Sector

Access Holdings Posts 52.6% Profit for the First Half of the Year

Parent Company of Access Bank Celebrates Remarkable Financial Performance in H1’23

Published

5 days ago

September 26, 2023

Investors King

Access Holdings Plc, the parent company of Access Bank, has reported a 58.9 percent surge in gross revenue to N940.3 billion for the first half of 2023.

The financial services giant also recorded remarkable growth in Profit Before Tax (PBT) and Profit After Tax (PAT) at 71.4 percent and 52.6 percent, respectively, culminating in N167.6 billion for PBT and N135.4 billion for PAT during the same period.

These financial milestones were unveiled as part of Access Holdings’ Audited Consolidated and Separate Financial Statements for the period concluding on June 30, 2023.

The driving force behind this unprecedented growth can be attributed to a potent combination of factors. A 63.0 percent growth in interest income and a 51.9 percent increase in non-interest income fueled the surge in gross revenue.

Access Holdings also witnessed a 35 percent year-to-date growth in customer deposits, capping the first half of 2023 at an impressive N12.5 trillion. This remarkable achievement encompassed all business segments, reinforcing the Group’s status as Nigeria’s largest financial institution by total assets.

The company’s total assets grew by 39.0 percent year-on-year to N20.9 trillion while shareholders’ funds surged by 40.6 percent to N1.7 trillion.

These astounding figures underline the Group’s ability to generate value from a diversified business portfolio, spanning banking, asset management, and payment services.

Herbert Wigwe, the Group Chief Executive Officer of Access Holdings Plc, commented on the company’s positive performance, saying, “Our growth plans for the African continent remain firm and clear, driven by the strong long-term growth prospects and trade opportunities seen across many of the countries.”

He went on to emphasize the company’s commitment to its 5-year cyclical strategy, stating, “Our primary objective remains to transform Access Holdings Plc into a leading financial and ecosystem player, fostering opportunities for shared prosperity among all stakeholders.”

Banking Sector

Central Bank of Nigeria Postpones 293rd Monetary Policy Committee Meeting

Published

1 week ago

September 22, 2023

Investors King

The Central Bank of Nigeria (CBN) has announced the postponement of its 293rd Monetary Policy Committee (MPC) meeting, originally scheduled for September 25th and 26th, 2023.

Dr. Isa AbdulMumin, the bank’s Director of Corporate Communications, released a statement on Thursday confirming the decision.

In the statement, Dr. AbdulMumin stated, “The Monetary Policy Committee of the Central Bank of Nigeria has deferred its 293rd meeting, which was initially planned for Monday and Tuesday, September 25th and 26th, 2023, respectively. A new date will be communicated in due course. We regret any inconvenience this change may cause our stakeholders and the general public.”

While the CBN did not provide an official reason for the postponement, some industry experts suggest it may be related to the pending approvals for the newly appointed governor and deputy governors of the bank.

President Bola Tinubu recently nominated Yemi Cardoso as the potential head of the CBN. Additionally, Tinubu has endorsed the nominations of four new deputy governors for the apex bank, who are expected to serve for an initial term of five years, pending confirmation by the Senate.

The nominated deputy governors are Emem Usoro, Muhammad Abdullahi-Dattijo, Philip Ikeazor, and Bala Bello. However, the appointment of the CBN governor is contingent upon Senate confirmation, which is currently on a yearly recess.

The CBN assures stakeholders and the public that the rescheduled MPC meeting date will be communicated promptly as soon as it is confirmed.