First Bank of Nigeria Limited (FirstBank) has addressed recent media reports regarding an ongoing commercial dispute with General Hydrocarbons Limited (GHL).
The bank reassures its customers, stakeholders, and the general public of its unwavering commitment to delivering exceptional banking services while maintaining transparency and professionalism in its operations.
In a statement released by the bank, FirstBank clarified the nature of the commercial transaction with GHL, stating that it involves several credit facilities extended to GHL for the development of Oil Mining Lease assets. These facilities were backed by robust loan agreements that clearly defined the obligations of both parties.
According to FirstBank, while it has diligently fulfilled its obligations under the loan agreements, the current dispute stems from the bank’s insistence on good governance and transparency in the transaction—an expectation that GHL has refused to meet.
FirstBank stated that it requested the appointment of an independent operator, mutually acceptable to both parties, to manage the financed asset in line with the loan terms. This step, aimed at ensuring greater transparency and value for all stakeholders, was rejected by GHL, which instead demanded additional funding. GHL’s refusal to meet the stipulated conditions for additional funding led to arbitration proceedings initiated by GHL.
Contrary to claims of abuse of court processes, FirstBank emphasized that it is the only party to have filed a substantive claim at the Federal High Court. The bank noted that its claim pertains to subsequent credit facilities granted to GHL, which were subject to legal resolution by Nigerian courts, as specified in the finance documents. GHL, on the other hand, initiated arbitration and approached the Federal High Court solely for preservative orders pending arbitration.
FirstBank further revealed that it had to approach the court due to GHL’s diversion of proceeds from crude oil off-taken from the Floating Production Storage and Offloading (FPSO) vessel. The bank, as a secured lender, sought legal remedies to recover diverted proceeds, preserve assets, prevent reoccurrences, and safeguard its interests.
With over 130 years of unbroken existence, FirstBank has reiterated its dedication to supporting the financial needs of its customers and fostering a strong credit culture. The bank underscored its responsibility to ensure borrowers meet their repayment obligations while taking lawful measures to address attempts to evade repayment.
FirstBank reassures its numerous customers and stakeholders of its stability, resilience, and commitment to providing gold-standard banking services. The bank emphasized that it remains calm, steadfast, and focused on maintaining its leadership role in the financial sector.
Additionally, the bank extended its gratitude to shareholders for the success of the indicatively oversubscribed Rights Issue by its parent company, FBN Holdings Plc (FirstHoldco). FirstBank looks forward to an equally successful conclusion of the recapitalization exercise in the coming phase.