The battle for the control of First Bank has become a high-stakes game of corporate chess, with powerful shareholders maneuvering for position and influence. The recent power struggle between Oba Otudeko and Femi Otedola has brought the bank’s complex web of interests and alliances to the forefront.
In the recent time , Femi Otedola, its board chairman appears to be wielding the most weapon . Just like in a chess game , he deployed the power of queen’s versatility in moving any number of squares in all directions, combined with its strategic importance in attacking and defending, and its endgame dominance in delivering checkmate to cage the lion in Oba Otudeko and end his dominance abruptly in First Holdings ; indeed, Femi Otedola’s rising influence now marks a new era of power in Nigeria’s financial sector, signaling his dexterity in the chess game.
To those who know Otedola inside-out , his capability to achieve the above is never in doubt .The Nigerian business game-master is deliberate, smart, and calculating, depending on which side of the table you are sitting on. When a growing doubts about why Otedola acquired 7.57% of FBNH shares in 2021 after Otudeko was sacked gained currency, he insisted in a press statement that ,he was not gunning for a seat at the FBNH board table but merely wanted to see good returns coming from sound management at the group. According to media reports, Otedola had said, “I am simply an investor who saw an opportunity in the financial institution and decided to take advantage of it through the investment I have made. My interest, contrary to speculations, is not to become Chairman of the bank or its Holdco. Moreover, I am in semi-retirement.” Of course, this could have been casual modesty, but Otedola is not known to be either casual or decidedly modest. Today , Otedola is the chairman of the same bank’s board and the largest single shareholder.
This is no longer a subject of controversy as Oba Otudeko exited the group following a N323.33bn block deal on the Nigerian Exchange Limited.The transaction saw 10.43bn ordinary shares of First Holdco traded in 17 off-market, negotiated deals at an average price of N31 per share. The block deal represents a 25 per cent majority stake in the financial holding company, which has 41.87bn outstanding shares.The negotiated window on the NGX allows parties to pre-arrange the price and terms of large-volume transactions before formal execution on the exchange.
As the largest single shareholder now and the chairman ,Board of Directors of First Bank , Otedola’s strategic moves have significant implications for the bank’s future. This development has continued to raise questions .First , with Otudeko’s exit, the boardroom dynamics have shifted, and one question on everyone’s mind is: How did Otedola cage the lion in Otudeko ?
The drama surrounding Oba Otudeko’s exit from First Bank had been on for the one year , however, it hit a boiling point last week . Being allegedly forced out suggests that the pressure became too great for him to withstand. One of the speculations surrounding Otudeko’s exit is that it might have been an attempt to salvage his reputation from further damage .
This may not be farfetched . Oba Otudeko’s reign as a prominent Nigerian businessman and Chairman of Honeywell Group has been marred by controversies, even outside First Bank , and he was allegedly consumed by one of such controversial dealings.
The immediate cause of his embarrassing exit could be traced to his alleged N12.3 billion fraud. The Economic and Financial Crimes Commission (EFCC) has accused him of a N12.3 billion fraud, alleging that he and others obtained funds from First Bank through fraudulent means between 2013 and 2014. The EFCC claims that the transactions involved forged documents and false representations to secure credit facilities
Faced with the threat of legal action and potential financial penalties, Otudeko opted to exit First HoldCo, selling his shares. Oba Otudeko and Tunde Hassan-Odukale, former major stakeholders, reportedly sold a combined 10.7 billion shares in First HoldCo, valued at approximately N312.18 billion. Otudeko alone divested 7,786,641,500 shares worth N241.3 billion through multiple nominee and investment accounts. This monumental deal is one of the largest in Nigerian stock market history, underscoring the substantial stake held by Otudeko and Odukale in First HoldCo ¹.The sale of Otudeko’s shares, valued at approximately N312.18 billion, was one of the largest transactions in Nigerian stock markethistory .
Sequel to the above report , the rumour that first hit the ground and raised a heated controversy was that the billionaire businessman Femi Otedola had taken control of FBN Holdings, the parent company of First Bank of Nigeria, after acquiring around 40 percent of the company’s shares in a major off-market transaction on the Nigerian Exchange.That report sent jitters down the spines of many investors based on the view that Femi Otedola’s growing influence in First Bank would likely have far-reaching implications . It sparked intense debate about the implications of Otedola’s growing influence on the financial sector and the broader economy. The above rumour persisted in spite of the fact that it was First Securities Limited that acquired the shares ; Femi Otedola was believed to be the driving force behind the purchase.
That fear may not be misplaced . Such a growing influence raises concerns about monopolistic tendencies and potential stifling of competition in the financial sector. The belief is that with 40 percent stake , Otedola’s interests might shape the bank’s future direction, potentially limiting opportunities for other stakeholders. Such a concentration of power could have far-reaching implications for Nigeria’s economic landscape .
Moreover ,with increased stake, there were concerns about First Bank’s corporate governance practices. As a major shareholder, Otedola might exert significant influence over the bank’s operations, potentially affecting decision-making processes. Furthermore ,the Central Bank of Nigeria (CBN), some believed , might face challenges in regulating the financial sector, particularly if Otedola’s influence extends to other banks or financial institutions. The CBN’s ability to maintain regulatory oversight and ensure fair competition will be crucial in mitigating potential risks associated with Otedola’s growing influence. They became restless with the possibility that Otedola might appoint loyalists to key positions, reshaping the bank’s leadership and operations.
However, the above speculations were later punctured by the bank. Contrary to earlier reports, it appears that a Special Purpose Vehicle (SPV) acting under the aegis of the federal government, rather than Femi Otedola, has acquired a significant stake in First Holdco Plc, the bank’s parent company.
This development is the culmination of a complex settlement brokered by the Office of the Attorney General of the Federation and the Central Bank of Nigeria (CBN). The arrangement aims to resolve the long-standing infighting between shareholders, particularly between Oba Otudeko and Femi Otedola, which had raised concerns about the bank’s ability to meet the CBN’s new capital requirements.
As part of the deal, Otudeko was forced to exit the bank, selling over 20% of his shares in a massive off-market transaction valued at N324.47 billion. Another long-term shareholder, the Hassan-Odukale family, also voluntarily exited the bank, selling 5% of their holdings.
The acquisition of shares by the SPV, acting as a trustee, suggests that the federal government may be taking a more active role in shaping the bank’s future. The trustee is expected to decide how to proceed with the shares and consider FBN’s plan for capital raise to meet CBN requirements.
Despite the fact Otedola has been exonerated , this development still raises several questions about the future of First Bank and the implications for its stakeholders. Will the federal government’s involvement lead to a more stable and prosperous future for the bank, or will it create new challenges and uncertainties? One thing is certain, however: the power dynamics at First Bank have shifted irreversibly, and the bank’s future will be shaped by the decisions taken in the coming weeks.
The deal’s specifics, including the fixed price of N31.00 per share, suggest a carefully negotiated arrangement between parties. The involvement of multiple stockbrokers and the execution of 17 separate deals underscore the complexity of the transaction. As th e situation continues to unfold, stakeholders will be watching closely to see how the trustee exercises its mandate and what implications this holds for First Bank’s future. One thing is clear: the bank’s trajectory will be shaped by the interplay of power, politics, and finance in Nigeria’s financial sector.
Even with the acquisition of shares by the SPV, this development may pave the way for Otedola to realize his long standing ambition of becoming the largest single shareholder after checking Otudeko and Odukale , the two major single shareholders who were threat to that ambition, to steer First Bank toward new growth opportunities, building on his recent successes in driving the bank’s financial performance and expanding its presence in the African banking sector .
Implications of the Otudeko Exit
As Otedola’s power and influence continue to grow, concerns are being raised about the concentration of power in the hands of a few individuals, which could lead to monopolistic tendencies and stifle competition in the financial sector. Furthermore, with Otedola’s increased stake in First Bank, there may be concerns about the bank’s corporate governance practices and the potential for Otedola to exert undue influence over the bank’s operations. The Central Bank of Nigeria (CBN) may also face challenges in regulating the financial sector, particularly if Otedola’s influence extends to other banks or financial institutions.
Femi Otedola’s increasing stake in First Bank, Nigeria’s oldest financial institution, has significant implications for the country’s economy and business landscape. With Otedola now holding a 40% stake in First Holdco, the parent company of First Bank, concerns are emerging about the concentration of power, corporate governance, and regulatory challenges.
Concentration of Power
Otedola’s growing influence raises concerns about monopolistic tendencies and potential stifling of competition in the financial sector. As the largest shareholder, Otedola’s interests may shape the bank’s future direction, potentially limiting opportunities for other stakeholders. This concentration of power could have far-reaching implications for Nigeria’s economic landscape ¹.
Impact on Corporate Governance
With Otedola’s increased stake, there are concerns about First Bank’s corporate governance practices. As a major shareholder, Otedola may exert significant influence over the bank’s operations, potentially affecting decision-making processes. However, industry analysts view Otedola’s rise as a welcome reset, expecting renewed focus on corporate governance, operational discipline, and shareholder returns ².
Regulatory Challenges
The Central Bank of Nigeria (CBN) may face challenges in regulating the financial sector, particularly if Otedola’s influence extends to other banks or financial institutions. The CBN’s ability to maintain regulatory oversight and ensure fair competition will be crucial in mitigating potential risks associated with Otedola’s growing influence.
A New Era for First Bank: What to Expect Under Otedola’s Leadership
As Femi Otedola takes the reins at First Bank, the financial institution is poised for a significant transformation. With the Central Bank of Nigeria’s recapitalization deadline looming, Otedola’s influence is likely to drive the bank’s efforts to raise N500 billion in new capital. This move will not only ensure the bank’s compliance with regulatory requirements but also potentially unlock new growth opportunities.
The appointment of loyalists to key positions may reshape the bank’s leadership and operations, injecting fresh perspectives and expertise into the organization. As stability returns to the bank, analysts expect improved financial performance, translating to higher returns for shareholders. This, in turn, could lead to a significant appreciation in First Holdco’s undervalued stock, potentially doubling in value over time.
Under Otedola’s leadership, First Bank may be on the cusp of a new era of growth, profitability, and shareholder value creation. As the bank navigates the challenges ahead, Otedola’s experience and influence will be crucial in shaping its future trajectory. With the right strategies and execution, First Bank may emerge as a major player in Nigeria’s financial sector, delivering long-term value for its stakeholders.
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The victory of Otedola over Otudeko was not accidental but a clearly schemed and strategic battle that lasted years . However, the opportunity came when with the sacking of Otudeko and other board members in 2021 by the Central Bank of Nigeria, CBN ; Mrs Ibukun Awosika as Chairman of the board of FBN and Mr Oba Otudeko as Chairman of the board of FBN Holdings were sacked .
Otedola exploited the above opportunity and loopholes in the weak corporate governance of the bank to establish his dominance with a power struggle that erupted between Femi Otedola and Oye Hassan-Odukale, another influential shareholder of First Bank’s holding company in 2021 . The development sent shock waves through the financial institution as battle for commanding equity stakes raised the stakes for power and influence at the bank, with each side vying for control.
The ambition , at first , was shrouded in mystery. Most importantly, the lack of clarity over Femi Otedola’s equity funding source in First Bank’s holding company then raised concerns, with growing suspicions that the equity play had deeper undertones and stronger institutional hands involved.However, he was very smart enough to conceal his ambition . No doubt , Otedola’s acquisition of 7.57% of FBNH shares was shrouded in mystery, with many questioning his true intentions. In a press statement, Otedola insisted that he was not gunning for a seat on the FBNH board table but merely wanted to see good returns coming from sound management at the group. However, given Otedola’s reputation as a calculating and deliberate business leader, many were skeptical about his motives.
The power struggle between Otedola and Hassan-Odukale also led sudden resignation of Remi Babalola as the Chairman of First Bank’s holding company, FBN Holdings. The sudden resignation of Remi Babalola as the Chairman of First Bank’s holding company, FBN Holdings, that sent shockwaves through the financial sector was partially attributed to the power struggle between Femi Otedola and Oye Hassan-Odukale though Babalola’s frustration also stemmed from the bank’s governance structure, where the regulator’s influence overshadowed the board’s decision-making authority.
However , the return of Otudeko to First Holdco as of one the single biggest shareholders challenged Otedola’s ambition. A contentious dispute erupted over the largest shareholder of FBN Holdings, the parent company of First Bank, with billionaire Femi Otedola and Oba Otudeko’s Honeywell Group both claiming the top spot. The controversy centered around conflicting records and claims of ownership, with each party presenting different percentages of shares held.
According to reports, Otedola initially became the single largest shareholder in December 2021 after acquiring 7.57% of FBNH’s shares. He later regained the position in June 2024, holding 9.41% after acquiring additional shares. However, Otudeko’s Honeywell Group, through Barbican Capital, claimed a substantial stake of 13.3% in July 2023, making them the largest shareholder according to some records.
The discrepancy in ownership percentages was highlighted by Businessday NG, which noted that the bank’s audited accounts and data from the Central Securities Clearing System (CSCS) and registrars showed different ownership percentages for the two parties. This led to ongoing disputes and investigations by regulatory bodies, including the Securities and Exchange Commission (SEC), which probed the purchase of shares by Honeywell Group.
The conflicting claims and records sparked a heated debate about the true ownership structure of First Bank. While Otedola was initially declared the largest shareholder, Businessday NG reported that Barbican Capital, owned by Honeywell, held a larger stake based on data from the CSCS and the bank’s registrars. The dispute highlighted the complexities and challenges of determining ownership structures in Nigeria’s financial sector.ition to rule the bank with claims and counter claims over who was the largest single shareholder .
But the immediate factor behind the victory of Otedola and the fall of Otudeko could be traced to a N12.3b fraud allegation against the latter . Oba Otudeko, a prominent Nigerian businessman and Chairman of Honeywell Group, had been embroiled in a series of scandals, including allegations of insider abuse, corporate governance breakdown, and a N12.3 billion fraud case. The Economic and Financial Crimes Commission (EFCC) has filed a 13-count charge against Otudeko, former First Bank Managing Director Stephen Olabisi Onasanya, and others, accusing them of obtaining funds from First Bank through fraudulent means ¹.
The EFCC alleges that between 2013 and 2014, the defendants fraudulently obtained funds from First Bank in tranches of N5.2 billion, N6.2 billion, N6.15 billion, N1.5 billion, and N500 million. These transactions purportedly involved forged documents and false representations made to secure credit facilities. Otudeko’s defense team has challenged the court’s jurisdiction, and the case has been adjourned to June 11, 2025, for a report on settlement negotiations or possible arraignment ².
The Central Bank of Nigeria (CBN) had sacked the board of First Bank, including Chairman Oba Otudeko and Ibukun Awosika, due to their refusal to comply with regulatory directives. The CBN had provided various regulatory forbearances and liquidity support to reposition the bank, enhancing its asset quality, capital adequacy, and liquidity ratios. However, the board’s decision to remove Managing Director Adesola Adeduntan without CBN’s approval led to the apex bank’s intervention ¹.
The CBN’s action was motivated by Otudeko’s insubordination and failure to subject himself to regulatory control and authority. Specifically, the bank had not divested its interests in Honeywell Flour Mills and Bharti Airtel Nigeria Ltd, despite CBN’s directives. Additionally, insider loans were found to be non-compliant with restructuring terms, contributing to the bank’s poor financial state. The CBN aimed to protect depositors and minority shareholders by retaining Adeduntan, who had worked with the bank since 2016 and was seen as a check on Otudeko’s influence ² ³.
