Billionaire businessman and Chairman of First HoldCo Plc, the parent company of First Bank of Nigeria, Femi Otedola has defended the company’s decision to take one-time hit of N748bn in old bad loans.
He described it as a deliberate clean-up rather than a sign of weakness in the bank’s operations.
In a tweet posted on his X handle on Saturday, Otedola wrote, “At First HoldCo we decided to clean house properly. We took a huge one-time hit of N748bn to admit old bad loans instead of pretending they do not exist. That is why profit looks like it crashed by 92%. Painful headline, but it is a serious long-term move.”
The write-off led to a 92 per cent decline in profit.
However, he explained that the losses were one-off, resulting from the recognition of long-standing non-performing loans carried over from previous years.
He also noted that the move aligns with directives from the Central Bank of Nigeria, which has been urging banks to strengthen balance sheets and stop postponing the recognition of bad assets, particularly ahead of the ongoing bank recapitalisation exercise.
“Because the @cenbank is pushing banks to stop kicking problems down the road. So First HoldCo basically closed the chapter on messy loans from past years, which sends a clear message that borrowing has consequences, and it helps rebuild trust,” he stated.
He added that despite the write-off, the group’s core business remains strong, generating N2.96 trillion in interest income and N1.91 trillion in net interest income, giving it the capacity to absorb the impact of the loss.
The cleanup is expected to improve transparency, restore confidence, and position First HoldCo for sustainable growth.
