Consolidation: CBN approves financial accommodation for merger of Unity, Providus banks
The Central Bank of Nigeria (CBN) has granted approval for a pivotal financial accommodation to support the proposed merger between Unity Bank Plc and Providus Bank Ltd.
According to a statement by CBN’s Acting Director, Corporate Communications Department, Mrs Hakama Sidi-Ali, this strategic move is designed to bolster the stability of Nigeria’s financial system
and avert potential systemic risks.
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Sidi-Ali said that the merger was contingent upon the financial support from the CBN.
“The fund will be
instrumental in addressing Unity Bank’s total obligations to the Central Bank and other
stakeholders.
“It is unequivocal to state that the CBN’s action is in accordance with the provisions of Section 42 (2) of the CBN Act, 2007.
”This arrangement is crucial for the financial health and operational stability of the post-merger organisation,” she said.
She said that it was important to emphasise that no Nigerian bank currently faced a precarious
situation comparable to that of Heritage Bank, which was recently liquidated.
She said that the apex bank remained committed to safeguarding depositors’ interests and ensuring the smooth functioning of the banking sector through proactive measures and strategic interventions.
“The CBN’s decision underscores its dedication to maintaining financial stability and promoting confidence in the banking system during this transformative period,” the director said.
“The merger is contingent upon the financial support from the CBN. The fund will be instrumental in addressing Unity Bank’s total obligations to the Central Bank and other stakeholders,” the statement read.
“It is unequivocal to state that the CBN’s action is under the provisions of Section 42 (2) of the CBN Act, 2007. This arrangement is crucial for the financial health and operational stability of the post-merger organisation.
“It is important to emphasise that no Nigerian bank currently faces a precarious situation comparable to that of Heritage Bank, which was recently liquidated.”
The CBN said it remains committed to safeguarding depositors’ interests and ensuring the smooth functioning of the banking sector through proactive measures and strategic interventions.
