First HoldCo’s Bold Reset with ₦748bn Bad Loan Write-Off

The financial landscape of Nigeria’s oldest banking institution shifted dramatically this weekend as FBN Holdings, popularly known as First HoldCo, released its unaudited financial statements for the year ended 2025. The report, made public on Friday, January 30, 2026, sent ripples through the Nigerian Exchange (NGX) by revealing a staggering 92% crash in post-tax profits.

This sharp decline was not the result of a failing business model, however, but rather a deliberate and massive impairment charge of ₦748.1 billion aimed at purging "legacy" bad loans from the group’s books.

By Saturday morning, January 31, the Chairman of First HoldCo, Femi Otedola, took to his official X account to break the silence and address the "painful headline" head-on. Otedola explained that the board had decided to prioritise long-term transparency over short-term optical gains. He noted that the institution chose to "clean house properly" by admitting the existence of old bad loans rather than continuing to carry them forward as hidden liabilities.

Otedola’s statement clarified that the ₦748 billion hit was a one-time recognition of non-performing loans (NPLs) that had hampered the institution’s balance sheet for years. According to The Cable, the group’s profit for 2025 plummeted to ₦44.9 billion, a far cry from the ₦677 billion recorded in the previous year. Despite this, Otedola insisted that the move was essential to rebuild trust and align with the Central Bank of Nigeria's (CBN) directive to stop "kicking problems down the road".

The financial data supports Otedola’s claim that the core engine of the bank remains exceptionally robust. While the bottom-line profit looked depleted, the group’s interest income soared to ₦2.96 trillion, with net interest income reaching ₦1.91 trillion. These figures demonstrate that First Bank of Nigeria, the group's commercial banking subsidiary, possesses a massive earning capacity that allowed it to absorb such a substantial write-off without compromising its operational stability.

This aggressive financial restructuring comes at a pivotal time for the Nigerian banking sector. The CBN, under Governor Olayemi Cardoso, has mandated a sweeping recapitalisation exercise with a hard deadline of March 31, 2026. Banks with international licences, such as First Bank, are required to maintain a minimum paid-up capital of ₦500 billion. By clearing the "messy" legacy loans now, First HoldCo is positioning itself as a "lighter and cleaner" entity for the final stretch of this recapitalisation era.