UPDATE: FBH Holdings N350bn Capital Raising Suffers Setback as Board Cancels AGM

The Annual General Meeting (AGM) of FBN Holdings Plc, the parent company of First Bank of Nigeria, has been postponed till further notice.

The board confirmed the indefinite postponement of the embattled company’s annual shareholders’ gathering in a notice to the Nigerian Exchange (NGX) Limited on Monday.

The AGM was earlier scheduled for Thursday, August 22, 2024, but was rescheduled to Tuesday, September 3, 2024, until it was cancelled on Monday.

FBN Holdings, chaired by billionaire businessman, Mr Femi Otedola, has been enmeshed in a leadership tussle for a while, and there are strong indications that this could hamper the capital raising plans of the company for its flagship banking subsidiary, First Bank, which must increase its capital base to N500 billion as a result of the new minimum capital requirement of the Central Bank of Nigeria (CBN).

The banking sector regulator in March 2024 gave players in the industry two years to raise their capital base and in the category First Bank belongs, it must have at least N500 billion because of its presence outside the shores of the country.

The board had planned to obtain the approval of the shareholders of the company to source N350 billion from the capital market, but this might be delayed until the leadership crisis is sorted.

“Notice is hereby given that the 12th AGM of the members of FBN Holdings, fixed to hold virtually on August 22, 2024, and rescheduled to Tuesday, September 3, 2024, at 10 am to consider and if thought fit, approve the accounts, declare a dividend, authorise the company to undertake a capital raise of up to N350 billion and other ancillary matters is hereby cancelled.

“Further information will be provided in due course, as appropriate,” the statement signed by the acting Company Secretary, Mr Adewale Arogundade, said.

Business Post reports that FBN Holdings, which has a former chief executive of Fidelity Bank, Mr Nnamdi Okonwo, as its chief executive, has been embroiled in controversies surrounding the ownership of its controlling stake and an alleged N40 billion fraud case that led to the dismissal of about 120 members of staff of the organisation.

It was alleged that a manager on the operations team, Mr Tijani Muiz Adeyinka, diverted N40 billion over two years, leading to the involvement of the police, who questioned some employees of the bank.

“Several employees were questioned by the Nigerian Police Force (NPF) and detained at the Lion’s Building for at least six hours, one person with direct knowledge of the incident said.

“Those employees needed to post bail before they were released. Restrictions have been placed on all their accounts except their First Bank accounts,” Tech Cabal said in a report.

As for the ownership tussle, a firm known as Barbican Capital Limited, owned by the former Chairman of the lender, Mr Oba Otudeko, claims it has a 15.01 per cent stake in the company, seeking to displace Mr Otedela, who claims to be the single largest shareholder of FBN Holdings.

Barbican Capital has filed a lawsuit against FBN Holdings, challenging the reduction of its shareholding from 13.61 per cent in December 2023 to 8.67 per cent.