FBN Shareholders Demand Otedola’s Removal Amid Allegations of Mismanagement and Control Grab

A group of shareholders holding 10% of the shares in First Bank of Nigeria Holdings Plc. has formally requested the company to call an Extra-ordinary General Meeting (EGM) under Section 215(1) of the Companies and Allied Matters Act (CAMA). The shareholders are seeking the removal of FBN’s Chairman, Mr. Femi Otedola, and Mr. Julius B. Omodayo-Owotuga, a Non-executive/Deputy CEO of Geregu Power Plc.

The shareholders, in their petition, allege that the instability at the bank began when former Central Bank of Nigeria (CBN) Governor, Godwin Emefiele, influenced Otedola’s acquisition of significant shares in the bank. This, they claim, led to Otedola’s eventual appointment as chairman of the FBN Holdings. According to the shareholders, Emefiele invited former First Bank CEO, Dr. Adesola Adeduntan, to work with Otedola, facilitating Otedola’s takeover of the bank.

The shareholders accuse Otedola of ousting key figures within the bank, including Adeduntan, Chairman Tunde Hassan-Odukale, and Tosin Adewuyi, who had been selected for the CEO role before Otedola’s interference. They also claim that Otedola engineered the appointment of Olusegun Alebiosu, the last-placed candidate in the CEO interview, while sidelining Adewuyi.

Allegations against Otedola extend to his full control of the bank, allegedly using his staff, including Omodayo-Owotuga, to exert power at both the holding company and the bank. The shareholders fear that Otedola’s preference for a N360 billion private placement of shares could result in him gaining absolute control of the institution and turning it into his personal asset without appropriate oversight or corporate governance.

Otedola’s involvement with former President Goodluck Jonathan’s administration and his prior business dealings, which included a sweetheart deal involving bad loans, have raised further concerns about his suitability to lead FBN. These allegations highlight concerns regarding the stability and governance of FBN Holdings under his leadership.

Meanwhile, reports indicate that Otedola has already been granted a loan of about $45 to $50 million by the African Export-Import Bank (Afreximbank) to solidify his control over FBN during the proposed private placement.

The controversy extends to the conflicting shareholder records at FBN, with some data indicating that Barbican Capital, affiliated with the Oba Otudeko-owned Honeywell Group, holds the largest shareholding in the company at 15.01%, contrary to FBN’s own audited statement listing Otedola as the largest shareholder.

Amidst these tensions, FBN Holdings has also experienced significant layoffs, with about 100 senior staff members let go as part of the bank’s restructuring efforts. These moves have raised questions about Otedola’s long-term vision for the bank.

With the demand for an EGM now in play, it remains unclear how the Securities and Exchange Commission (SEC) and the Central Bank of Nigeria (CBN) will respond to the shareholders’ call for action against Otedola and his proposed private placement plan.

More developments are expected to follow as the dispute between FBN’s management and shareholders unfolds.