FirstBank of Nigeria Limited has issued a formal statement to counter misleading reports regarding its ongoing legal battle with General Hydrocarbons Limited (GHL), an oil and gas firm owned by the publisher of Thisday newspaper, Prince Nduka Obaigbena.
The bank described the media coverage as false and an unjust attack on its corporate integrity. The bank strongly rejected accusations that it had abused legal processes in the matter.
In a carefully crafted statement released on Tuesday, January 15, 2025, FirstBank clarified the nature of the dispute with GHL and reiterated its commitment to upholding transparency, good governance, and the rule of law.
The conflict, according to the bank, revolves around the failure of GHL to meet its obligations under a set of loan agreements executed in connection with the financing of Oil Mining Lease (OML) assets. These agreements, the bank explained, were negotiated under strict terms designed to protect both parties’ interests.
A Matter of Governance
The bank maintained that it had met all its responsibilities under the loan arrangements, noting that the disagreement arose when it demanded transparency and good governance from GHL—a request that was allegedly rejected by the oil company. “FirstBank’s commitment to its customers and the rule of law is unwavering. We cannot compromise on matters of governance and corporate responsibility,” the statement read.
FirstBank stressed that it would not discuss the specifics of the ongoing case in court, adhering to the principle of sub judice. This stance reflects the bank’s profound respect for the judicial process and its desire to let the courts decide the matter on its own merits. However, the bank was quick to express its displeasure over what it described as “sponsored false narratives” making their rounds in the media.
The Root of the Dispute
The root of the issue, as outlined in the bank’s statement, lies in the substantial credit facilities extended by FirstBank to General Hydrocarbons to facilitate the development of OML assets. These loan facilities, the bank clarified, were secured by solid legal agreements that outlined both parties’ responsibilities. However, issues arose when GHL allegedly breached these terms by diverting proceeds meant to secure the assets, prompting FirstBank to take legal action.
In a bold move, the bank had previously requested the appointment of an independent operator to manage the financed assets in a transparent manner. This action was in line with the loan agreement and aimed at protecting the interests of FirstBank and its stakeholders. However, GHL’s refusal to comply with this request set the stage for the legal clash, leading FirstBank to file a case in court.
“To safeguard our assets and recover diverted proceeds, taking legal action became the only option,” said a spokesperson for the bank. “We cannot allow such breaches to go unaddressed, and we are committed to ensuring that this does not happen again in the future.”
The Alleged Arbitral Delay
According to FirstBank, GHL’s pursuit of what it termed “unnecessary arbitral proceedings” further complicated the matter. The bank believes that these proceedings were an attempt to derail the legal process and delay the resolution of the issue.
Despite the legal complexities surrounding the dispute, FirstBank remains resolute in its decision. “Our duty is to protect the interests of our shareholders and customers. We will not allow anyone to tarnish the bank’s reputation or jeopardize the stability we have worked so hard to build,” the statement emphasized.
Commitment to Customers and Shareholders
In a demonstration of confidence, FirstBank reassured its customers and stakeholders that the bank remains financially strong and poised for continued growth. The bank’s efforts to provide high-quality services have earned it a stellar reputation as one of the leading financial institutions in the country, both domestically and internationally.
“We are committed to maintaining the gold standard of banking services that our customers have come to expect,” said the bank’s spokesperson. “We want to assure our clients that they can continue to rely on FirstBank as a steady partner in their financial endeavors.”
Furthermore, the bank expressed its gratitude to shareholders for their overwhelming support during the first round of capital raising through the over-subscribed Rights Issue of its parent company, First Holdco Plc. This successful exercise, according to FirstBank, is a strong indication of investor confidence in the institution’s long-term stability and prospects.
The bank looks forward to the final phase of its recapitalization exercise, expected to be concluded soon. “We are optimistic about the future and committed to ensuring that FirstBank remains a key player in the Nigerian banking sector,” the statement concluded.
Public Perception and Trust
The ongoing legal dispute has attracted significant media attention, with various outlets covering the case extensively. However, the recent string of misleading reports has raised concerns among stakeholders about the potential impact on public perception and trust.
FirstBank’s clear and detailed response to these allegations seeks to reassure the public that the bank is not involved in any illegal or unethical activities. “We understand the importance of transparency in maintaining public trust, and we are committed to upholding the highest standards of corporate governance,” said the spokesperson.
With its statement, FirstBank aims to put to rest any doubts about its integrity and its role as a responsible corporate citizen. By highlighting the steps it has taken to protect its interests and uphold its contractual obligations, the bank has reaffirmed its position as a pillar of Nigeria’s financial sector.
Looking Forward
Despite the challenges presented by the legal dispute, FirstBank has vowed to continue offering world-class banking services to its customers. The bank’s track record of delivering excellent customer service and its strong financial foundation position it to weather the current storm and emerge even stronger.
“We remain committed to our mission of providing innovative banking solutions while maintaining the highest standards of integrity and transparency,” the statement concluded.
