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Obafoluke Otudeko, the disgraced former chairman of First Bank of Nigeria PLC, would most likely be a peacock if he were animals. Otudeko, like the flightless eagle, is so consumed by greed that he may have began to overestimate his own worth. Otudeko, a self-proclaimed billionaire, lived in a rented luxurious apartment on Bourdillon Road in Ikoyi until the billionaire chairman of Globacom, Dr Mike Adenuga, purchased the building and sent him on a house-hunting spree. Oba screamed blue murder, but little came of it.
Oba now resides on Gerard Road in Ikoyi in one of Pascal Dozie’s luxurious flats, the founder and former Chairman of Diamond Bank Plc. But, wait a minute, why is Oba living in a rented apartment at his level? The life of a billionaire is always perplexing. Most of the time, they have odd and marvellous personalities that set them apart from their peers. But every now and then, they do stuff that make them look like the ordinary Joe on the street. This is why the case of Otudeko blurs the line between complete scepticism and intense curiosity. Despite his ‘billions,’ Otudeko is a proud homeowner in the same city where he has made thousands of billions!!!
Curiously, however, those who know say his life and lifestyle are built on a facade of prosperity; and that the underbelly of his presumed wealth is a seamy bubble of debts.
Oba Otudeko, for example, is the founder and chairman of the Honeywell Group. Until recently, he was the chairman of FBN Holdings PLC, the holding firm that controls First Bank, a role he held until 2010. The Central Bank of Nigeria, CBN, removed Oba Otudeko from his exalted role at the FBN on Thursday, April 29, due to the apex bank’s regulatory forbearance (a financial term for softening some of the strict rules that banks must comply with if they are to avoid being taken over by the CBN) and support in the corporate restructuring of the bank to protect it from crumbling uncontrollably.
Oba Otudeko’s Honeywell, among other corporate interests, is hugely indebted to the FBN. Days back, the CBN wrote the bank, stating, “The company (Honeywell Flour Mills) is required to fully repay its obligations to the bank within 48 hours, failing which the CBN will take appropriate regulatory measures against the insider borrower and the bank.”
A big regulatory concern was Honeywell Flour Mill’s collateral for the loan facility. According to the CBN’s memo, “We further noted that in four years, the bank is yet to perfect its lien on the shares of Mr Oba Otudeko in FBN Holdco which collateralised the restructured credit facilities for Honeywell Flour Mills contrary to the conditions precedent for the restructuring of the company’s credit facility.”
The CBN further stated that the insiders who took loans in the bank, with controlling influence on the board of directors, failed to adhere to the terms for the restructuring of their credit facilities which contributed to the poor financial state of the bank.
According to Godwin Emefiele, Governor, Central bank of Nigeria, “The CBN’s recent target examination as at December 31, 2020, revealed that insider loans were materially non-compliant with restructure terms (e.g. non-perfection of lien on shares/collateral arrangements) for over 3 years despite several regulatory reminders. The bank has not also divested its non-permissible holdings in non-financial entities in line with regulatory directives.”
In an attempt to outwit the CBN, the Board of Directors of First Bank of Nigeria Limited announced on Wednesday that it had named Gbenga Shobo as its Managing Director/Chief Executive Officer in a step that sent the financial sector into a tailspin (CEO). Shobo’s appointment came after it was announced that the previous MD/CEO, Dr Adesola Adeduntan, had resigned.
However, the CBN ruled that the transfer process was invalid and that the board had no excuse because Dr Adeduntan’s term had not yet expired and there had been no notice from First Bank to the CBN about the transition. Adedunatan is back in the building, but Oba Otudeko and the bank’s other top directors are still out in the cold.
Source: The Capital