Boardroom: First Bank’s Ownership Tussle

First Bank Headquarters, Otedola and Hassan-Odukale. Photo by The Nation

First Bank, the oldest financial institution in Nigeria is in the news again. This time, it is not for declarations of humongous dividends or the importation of live elephants to Lagos to mark its anniversary of existence. It has to do with high-level boardroom politics, a development that may have a domino effect on share prices and customer confidence.

There are three developments now at First Bank. First, the resignation of Remi Babalola, former chairman of FBN Holdings Plc. He was appointed by the Central Bank of Nigeria. It was after Oba Otudeko, who occupied the seat before him, threw in the towel.

The other two aspects are the acquisition of more shares by the Nigerian investor, Femi Otedola and the response in like manner by another boardroom player,Tunde Hassan-Odukale. Right now, the two men have their caps in the ring at First Bank headquarters.

Now on Babalola, one time Nigerian Minister of State for Finance, who resigned his appointment on Friday 17 December. According to a report by Premium Times, Babalola claimed in his letter that he resigned “amid frustrating attempts to reinstate confidence in the brand and improve corporate governance within the system.”

In his words: “I accepted the appointment as a non-executive director and chairman of the board of FBN Holdings PLC on April 30th 2021 as a national call to service, an opportunity to deploy my endowments to illuminate humanity.”
“Since then, it has been a slug of hard work, sacrifices and battles.”

It was not, however, a complete tale of woes when Babalola was there. He claimed, according to the report, that despite the challenges, the board was able to effect major changes in corporate governance. In other words, he said the board overhauled, “reinstated confidence in the brand, stalled value erosion, transferred registrars for transparency, introduced openness and due processes in all transactions, unveiled significant investors, and pushed for improved performance.”

“However, with the rot, stench and corruption in the system, it has been well-nigh impossible for me to break; and upon deep reflection and partial to my personal values, I write to formally resign my appointment as a non-executive director and chairman of the board of directors of FBN Holidays PLC, effective immediately,” he wrote.

“This should allow ample time for the institution’s shareholders to plan a smooth transaction through the next Annual General Meeting.”

Otedola versus Hassan- Odukale

Otedola whose original acquisition was 5.07 per cent, added 2.5 per cent, bringing his equity stakes to 7.57 per cent. In another financial report, Otedola can now boast of about 2.72 billion shares in FBNH (the parent of company of first Bank and other subsidiaries) “including direct personal shareholding and indirect interests in five other firms. “This represents 7.57 per cent of FBNH’s total issued share capital of 35.895 billion ordinary shares of 50 kobo each.”
This means Otedola has more than his closest rival there. That is, more than Hassan-Odukale’s 5.36 per cent.

The issue of who calls the boardroom shots will be determined after the Board of Directors of the bank file the statutory notification to the CBN. Meanwhile, bank customers, shareholders and the general public have their eyes on the scale, watching where the pan will tilt.