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First Bank Confirms Merger, Acquisition With Heritage And Polaris Banks


First bank of NIGERIA Holdings has, on Friday, confirmed the Thursday 12 March 2020 story titled, “First Bank Set to merge with Heritage Bank, Polaris Bank”

In a notice to the Nigerian Stock Exchange (NSE) on Friday, March 13, 2020 signed by Seye Kosoko, Company Secretary, FBN Holdings Plc, did not deny or confirm the newspaper report on the proposed acquisition.

In the note, titled, Re: Request For Clarification- “First Bank Set To Merge With Heritage Bank, Polaris Bank”, FBNH said the bank, like any other serious financial institution of its stature, will always be a reference point because of its size, liquidity and systemic importance.

FBNH said, “With respect to the online publication on the largest subsidiary of FBN Holdings Plc, First Bank of Nigeria Limited by Independent Newspapers Limited dated 12 March 2020 captioned “First Bank Set to merge with Heritage Bank, Polaris Bank”, we wish to state as follows in line with Rule 17.10 of the Rulebook of the Exchange 2015 that:
“Recent events in the industry have thrown up mergers and acquisition opportunities for banks.

“There would always be speculation on First Bank’s involvement on account of its size, liquidity, systemic importance and historic support in backstopping the industry. Inorganic growth remains a strategic consideration for all financial institutions, but from First Bank’s perspective, will only be considered when it is value accretive to shareholders and other key stakeholders.

“Similar to other Nigerian banks, First Bank continues to scan sub-Saharan Africa in general for potential acquisitions.

“FBN Holdings Plc is mindful of its responsibilities as a Premium Board listed company and will make appropriate disclosures should it find such value.”

 Nigeria will soon witness an­other round of merger and acquisition in the banking sector as financial advisers are putting finishing touches to a merger arrangement be­tween First Bank of Nigeria, Heritage Bank and Polaris Bank.

A source close to the merger informed reporters that both Polaris and Heritage have been looking for a worthy bank to do busi­ness with as they have been told by the apex bank, the Cen­tral Bank of Nigeria (CBN), after a round of stress test in banks last year to shape up or lose their licence.

The source also informed that these three entities are vigorously pursuing the merger and acquisition talks across all available means.

Source gathered that Polaris Bank, formerly Skye Bank, for instance, which is currently under the Asset Management Corpora­tion of Nigeria (AMCON), is up for sale since it became a bridge bank in 2018.

The CBN had stated in October last year that seven com­mercial banks in the country failed stress test in adequate funding at the end of 2018.

In a financial stability report published by the bank, it was revealed that in less than 30-day period analysis, seven Nigerian banks were not ad­equately funded, while in the 31-90 days bucket, nine banks had funding gaps.

Overall, the cumulative position for the industry showed an excess of N4.8 trillion as­sets over liabilities.

The banking regulator, however, did not mention the names of the seven of the banks but it privately in­formed the affected banks to look into the possibility of merger and acquisition to prevent a total collapse.
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