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First Bank Recovers N456 Billion Loan From Heritage Bank Before License Revocation

Nairametrics can confirm that First Bank has received the full repayment of a “N456 billion loan” extended to Heritage Bank...READ THE FULL STORY HERE▶▶▶

This recovery is part of a “bailout loan” arranged during the tenure of former Central Bank of Nigeria (CBN) Governor Godwin Emefiele.

According to top sources from First Bank, the CBN credited the tier-one bank prior to its decision to revoke Heritage Bank’s license, thus averting what could have been a significant impairment charge for First Bank.

On Monday, the CBN announced the revocation of Heritage Bank’s license, stating that “the bank has continued to suffer and has no reasonable prospects of recovery,” which led to the bank’s eventual collapse.

Verified information from Nairametrics indicates that the actual amount received by First Bank was N456 billion, concluding a seven-year wait since First Bank supported Heritage Bank in clearing.

First Bank’s financial statements reveal that the bank held balances with other banks amounting to N688 billion as of the first quarter ending March 2024, down from N735 billion in December 2023.

According to First Bank, these balances include clearing balances with other deposit money banks. First Bank provides clearing services for some banks in Nigeria, and the current balances within Nigeria include clearing exposures to banks as of December 31, 2023.

Push for Recovery: Efforts to recover the N456 billion loan intensified as Heritage Bank’s situation worsened over the years. However, a resolution was not reached until a new board and management took over the holding company of the bank earlier this year.

The amount was eventually credited to First Bank ahead of the official announcement of Heritage Bank’s license revocation, ending the seven-year wait.

This payment is expected to be reflected in FBN Holdings’ half-year financial statements, bolstering its cash positions and preventing the bank from incurring a write-off for the loans.

FBN Holdings reported a pre-tax profit of N358.8 billion in the first quarter of 2024, alongside an impairment provision of N227.4 billion.…Continue The Full Reading.>’.

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