Shareholders Revolt: First Bank's Otedola Faces Ouster Amid Fraud Allegations

 

In a dramatic turn of events that has sent shockwaves through Nigeria's financial sector, a group of shareholders at First Bank of Nigeria Holdings Plc (FBN Holdings) is calling for the immediate removal of Chairman Femi Otedola. The move comes amid allegations of fraud and corporate governance breaches, threatening to upend the leadership of one of Africa's oldest and most respected financial institutions.

The Brewing Storm

The disgruntled shareholders, who collectively hold a 10% stake in the bank, have demanded an Extraordinary General Meeting (EGM) to be convened within 21 days, as stipulated by Section 215(1) of the Companies and Allied Matters Act (CAMA)

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. This bold move marks the latest chapter in a saga that has been unfolding since Otedola's controversial ascension to the chairmanship in early 2024.At the heart of the controversy lies a web of allegations that paint a picture of corporate intrigue and alleged misconduct:

• Questionable Acquisition: Shareholders claim Otedola's rise to power was orchestrated through a significant share acquisition facilitated by former Central Bank of Nigeria (CBN) Governor, Godwin Emefiele
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• Regulatory Oversight: Accusations have surfaced that Otedola assumed his position without obtaining necessary security clearances from the State Security Service (SSS) and the Economic and Financial Crimes Commission (EFCC)
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• Power Consolidation: Critics argue that Otedola has systematically removed key personnel and installed personal associates in crucial positions, effectively centralizing control
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The Catalyst for Conflict

The immediate spark for this shareholder revolt appears to be a proposed N360 billion private placement of bank shares

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. This move has been met with fierce opposition from shareholders who fear it could grant Otedola unchecked control over the institution

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."With the private placement of N360 billion, other shareholders now fear that it will give Otedola absolute control and could turn First Bank to a piggy bank without checks, balances and corporate governance," one insider revealed

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.Adding fuel to the fire, reports have emerged of a $45-50 million loan (approximately N90 billion) granted to Otedola by the African Export-Import Bank (Afreximbank), allegedly to facilitate further share acquisitions

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A History of Controversy

Otedola's tenure at First Bank has been marked by turbulence from the outset. Following his takeover, he reportedly orchestrated the removal of several key figures, including:

• Adesola Adeduntan, former CEO
• Tunde Hassan-Odukale, former chairman
• Tosin Adewuyi, Executive Director
• Folake Ani-Mumuney, Group Head
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These moves have been interpreted by some as a systematic purge of potential opposition within the bank's ranks.

The Broader Context

This leadership crisis at First Bank is unfolding against a backdrop of wider turmoil in Nigeria's financial sector. The bank recently underwent a major organizational overhaul, resulting in the dismissal of approximately 100 senior staff members, including top executives

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.The controversy also touches on broader issues of corporate governance and regulatory oversight in Nigeria's banking sector. The alleged involvement of former CBN Governor Emefiele in facilitating Otedola's rise has raised questions about the independence of regulatory bodies and the potential for political interference in financial institutions

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Looking Ahead

As the clock ticks down to the potential EGM, all eyes are on First Bank. The outcome of this shareholder revolt could have far-reaching implications not just for the bank, but for corporate governance standards across Nigeria's financial sector.For now, First Bank customers and stakeholders are left to wonder: Will this venerable institution weather the storm, or is this the beginning of a new era in its long history?As this story continues to develop, one thing is clear: The battle for control of First Bank is far from over, and the repercussions may be felt throughout Nigeria's financial landscape for years to come