Providus Bank Limited, a commercial bank established in 2016, is making a strategic move to acquire a majority stake in Unity Bank Plc as part of its expansion plan. The Central Bank of Nigeria (CBN) is reportedly monitoring the proposed business combination closely.
According to a reliable industry source, the acquisition process, characterized as a business combination, has been in progress since June, with Providus Bank keeping the CBN informed. As part of the deal, Providus is said to have requested the isolation of Unity Bank’s non-performing loans, as the latter has been grappling with meeting its minimum capital requirement since 2017.
Unity Bank, formed in 2006 through the merger of nine banks, is a prominent retail bank in Nigeria with 213 business offices across the country. The bank has faced financial challenges, including a failed attempt by Milost Global Inc. to invest $1 billion in 2018, and it has been actively seeking a suitable partner.
In its recently released financials for the 9-month period ending September 30, 2023, Unity Bank reported a loss after tax of N47.917 billion, a significant decline from the N2.029 billion profit after tax recorded in the same period in 2022. The bank also posted a Foreign Exchange revaluation loss of N38.162 billion, representing a substantial increase from the N54.005 million loss in the corresponding period of 2022. The gross income for the period decreased by 10%, from N42.292 billion in 2022 to N38.183 billion in 2023.
Unity Bank’s Managing Director/CEO, Mrs. Tomi Somefun, emphasized the institution’s focus on recapitalization, asset creation, and innovation to compete effectively in new markets. ProvidusBank, founded by Walter Akpani and licensed by the CBN, boasts strong IT infrastructure and digital channels, positioning it to provide innovative financial solutions across personal, private, corporate, commercial, and digital banking sectors.
Madukwe B. Nwabuisi is an accomplished journalist renown for his fearless reporting style and extensive expertise in the field. He is an investigative journalist, who has established himself as a kamikaze reporter.