Otedola plans deeper First HoldCo bet, says personal investment tops N600bn

CHAIRMAN of First HoldCo Plc, Mr Femi Otedola, has indicated that he could increase his ownership in the financial group beyond a controlling stake, saying his long-term ambition is to hold more than 51 percent of the company.

Speaking in an exclusive interview with Nairametrics published on Monday, Otedola said his commitment to First HoldCo is a generational investment rather than a short-term turnaround play.

The remarks come after First HoldCo emerged as Nigeria’s most valuable listed banking group, with its share price more than doubling this year following a series of acquisitions that strengthened Otedola’s position as the company’s largest shareholder.

The billionaire disclosed that he has committed over N600 billion of his personal funds to the lender, describing the investment as evidence of his confidence in the bank’s future and its long-term prospects.

READ ALSO: Otedola raises First HoldCo stake to 20.42% with N29.6bn share purchase

“My investment threshold is always over and above 51 percent,” Otedola said.

He explained that maintaining majority shareholder control, while protecting minority investors, has always been central to his investment philosophy because it enables effective restructuring and long-term value creation.

Otedola said the same strategy guided his previous investments. At African Petroleum Plc, later renamed Forte Oil Plc, he increased his ownership from 28 percent to 75 percent before exiting in 2019. At Geregu Power Plc, he expanded his stake from 51 percent to 95 percent before reducing it to 77 percent after the company’s listing.

“I am on the same trajectory with First HoldCo Plc,” he said.

According to Otedola, his N600 billion investment reflects a firm belief in the institution’s fundamentals rather than speculative interest.

Bank was facing severe crisis

Otedola said he invested in First HoldCo at a time when the institution was struggling with deep governance and financial challenges that threatened its stability.

He said years of weak corporate governance, insider abuses and poor lending practices saddled the bank with more than N2 trillion in non-performing loans, weakening its financial position and prompting concerns from the Central Bank of Nigeria (CBN).

“Before 2021, First Bank of Nigeria… stood at a genuine crossroads,” he said.

He added that the CBN considered the bank’s capital position and governance failures serious enough to warrant regulatory intervention in order to safeguard more than 30 million customers and minority shareholders.

READ ALSO: With Otedola in control, here’re 4 key developments to watch at First Bank

According to Otedola, the apex bank eventually dissolved the boards of First Bank and First HoldCo over governance lapses, unresolved insider-related exposures and violations of regulatory directives.

Rather than avoid the troubled lender, he said he viewed the crisis as an opportunity to rebuild one of Africa’s oldest financial institutions through a carefully planned acquisition of shares.

“This was not a hostile or opportunistic move, but a calculated commitment to rescue, rebuild and reposition First HoldCo Plc,” he said.

Governance reforms and recapitalisation

After becoming chairman in January 2024, Otedola said the board focused on rebuilding investor confidence by implementing governance reforms and cleaning up the bank’s balance sheet.

He disclosed that the group recognised a one-time impairment charge of N1.7 trillion to eliminate legacy bad loans while launching a recapitalisation programme through rights issues, private placements and strategic asset sales.

The exercise, he said, enabled the group to surpass the CBN’s N500 billion minimum capital requirement while progressing towards a N1 trillion paid-up capital target.

Otedola argued that stronger capital bases are necessary for Nigerian banks to finance the country’s aspiration of building a $1 trillion economy.

“I reiterate my belief that a modern Nigerian economy aspiring toward a $1 trillion GDP cannot be anchored on weakly capitalised banks,” he said.

Earnings improve as bad loans are cleaned up

The First HoldCo chairman revealed that the bank has impaired more than N3 trillion in loans over the past decade while strengthening its credit governance framework to prevent similar problems in the future.

He said the reforms are already yielding results, pointing to the group’s first-half 2026 performance, where profit before tax rose 83.5 percent year-on-year to N653.4 billion and return on average equity reached 30.4 percent, which he described as the strongest among Nigeria’s major banking groups.

READ ALSO: First Bank: How Otedola bought Otudeko, Hassan-Odukale’s 10.43bn shares, raised stake to 37%

Responding to suggestions that the rally in First HoldCo shares reflects the so-called ‘Otedola effect,’ he said investor confidence has been driven by both the group’s improving financial performance and continued insider purchases.

“Our continued buying signals conviction to the market that we are convinced about the future, and this is anchored in our disclosed earnings turnaround, not market sentiments alone,” he said.

Otedola also ruled out the possibility of exiting his investment in the same manner as Forte Oil, saying banking is fundamentally different because of its strategic importance and reliance on public confidence.

He described First HoldCo as a long-term generational commitment, adding that the group intends to strengthen corporate governance, risk management, innovation and operational efficiency while delivering consistent dividends to shareholders and retaining sufficient capital for future expansion.

The chairman also argued that Nigerian banks remain undervalued compared with their African peers despite generating strong returns on equity.

“Our vision and my legacy as chairman is to transform an institution that stood at the brink of a regulatory takeover to one setting the pace for its industry,” Otedola said.

He added that his ultimate objective is to restore First HoldCo to its position as Nigeria’s leading financial institution and one of Africa’s foremost banking groups.