Fresh concerns have emerged following FirstHoldCo Plc’s announcement of its intention to exit regulatory forbearance by December 2025, raising questions about the group’s readiness and transparency as the deadline approaches.
In a statement on Thursday, FirstHoldCo assured investors it remains on track to meet compliance requirements and sustain dividend payments beyond the December 31, 2025 timeline. The company linked the breach of the Single Obligor Limit (SOL) at its flagship subsidiary, FirstBank, to foreign currency loans extended to two clients, who were adversely impacted by the naira’s sharp devaluation—over 200%—between 2023 and 2024.
The group explained that it plans to resolve the SOL breach through a capital raise scheduled for the second half of 2025. It further clarified that the exposures under regulatory forbearance are syndicated loans spread across various industries, currently undergoing restructuring.
“With the planned completion of the capital raise in H2 2025, among other measures, the bank will cure the breach by year-end. The forborne loans are tied to syndicated facilities with assets that have resumed production and are generating revenue,” the company stated. It added that some receivables tied to these loans are awaiting payment from government agencies and that the syndicate lenders are working to conclude restructuring within the 2025 financial year.
The statement also assured that “any loan not fully restructured will be provisioned and removed from forbearance,” reaffirming FirstHoldCo’s commitment to maintain dividend payments and deliver value to shareholders.
However, analysts remain skeptical. Notably absent from the company’s communication is the current status of the syndicated loan to Aiteo Group. Several members of the lending consortium—GTCO, Zenith Bank, and AccessCorp—have already begun provisioning for the Aiteo facility. GTCO reportedly took provisions in December 2024, while Zenith and Access are expected to do so within days. The restructuring prospects are further complicated by Aiteo’s ongoing legal dispute with Shell Trading, another member of the consortium, over asset valuation.
Banking analysts are questioning how FirstHoldCo plans to successfully restructure such a facility within six months under these circumstances. “The statement does not inspire confidence or provide clarity on how the group will exit forbearance by year-end or maintain dividend payouts,” one analyst said.
There is also increasing scrutiny over the ongoing acquisition of Leadway shares by billionaire investor Femi Otedola. Analysts say the transaction, involving shares held by former chairmen Oba Otudeko and Tunde Hassan-Odukale, merely transfers control of the holding company but does not address the core challenge of boosting FirstHoldCo’s capital base above the N500 billion mark through a rights issue or other means. Investors are calling for greater transparency around the acquisition and capital plans.
Despite the concerns surrounding FirstHoldCo, the Nigerian equities market posted gains on Thursday, driven by renewed investor confidence in the banking sector. The All-Share Index (ASI) rose by 39 basis points in early trading, with banking stocks leading the rally, gaining 130bps overall.
All Tier-1 banking stocks traded in the green. FirstHoldCo led the pack with a 5.12% gain, followed by AccessCorp (3.34%), Zenith Bank (2.16%), UBA (1.18%), and GTCO (0.63%). The rally was further supported by share purchases from Zenith Bank’s founder and CEO, and optimistic dividend guidance across the sector.
