Bank consolidation: CBN approves merger of Providus Bank with Unity Bank
CHIGOZIE AMADI
The Central Bank of Nigeria (CBN) has approved the merger between Providus Bank Limited and Unity Bank Plc.
The Banks in a joint statement said, this is marking a significant milestone in the evolution of their respective institutions.
The statement which was signed by the management of Providus Bank Ltd and Unity Bank Plc, said the merger represents a strategic and complementary union that will leverage the strengths of both banks to create a leading financial institution in the industry with footprints in retail, corporate, commercial, and digital banking.
Unity Bank Plc, with its rich legacy of over 18 years, has established a robust retail banking network, comprising more than 220 branches nationwide.
With a strategic niche in the agricultural business, our commitment to delivering exceptional customer service and a comprehensive range of financial products has earned us the trust and loyalty of millions of customers.
Providus Bank Limited, on the other hand, is renowned for its innovative approach to banking, boasting a strong digital footprint, innovative products, high quality service culture and strong focus on helping customers grow.
As a fast-growing new-generation bank, Providus Bank has consistently pushed the boundaries of technology to deliver cutting-edge financial solutions that cater to the evolving needs of modern consumers.
According to the statement, the combination is driven by a shared vision to provide an unparalleled banking experience to our customers.
The statement further noted that by combining Unity Bank’s extensive branch network and deep-rooted customer relationships with Providus’s digital prowess and innovative spirit, “we aim to deliver a seamless blend of traditional and modern banking services.
“Our customers will benefit from an expanded suite of products and services, greater convenience, and improved access to banking solutions across various channels.
“The integration of our digital platforms will offer enhanced security, faster transactions, and a more personalized banking experience.
“As we embark on this journey together, we remain committed to maintaining the highest standards of corporate governance, financial stability, and customer satisfaction.
“Our united team of dedicated professionals will work tirelessly to ensure a smooth transition and continued tradition of excellence in all our operations,” the statement said.
The management further noted that this combination signifies the beginning of a new chapter in our shared history, one that is filled with promise and potential.
“We are confident that the combined strength of both entities will create a formidable force in the banking sector, driving innovation, growth, and prosperity for our customers, employees, and stakeholders.
“We extend our heartfelt gratitude to the Central Bank of Nigeria for their consideration and approval and to our customers, employees, and partners for their unwavering support.
“Together, we are poised to achieve greater heights and redefine the future of banking in Nigeria.
Meanwhile,the CBN in a statement signed by the acting Director, Corporate Communications, Hakama Sidi, on Tuesday, said the action is in accordance with the provisions of Section 42 (2) of the CBN Act, 2007.
The development signals the first merger to be approved following a mandate by the apex bank to increase its minimum capital base
The apex bank also announced approval of a pivotal financial accommodation to support the proposed merger between Unity Bank Plc and Providus Bank Limited.
This strategic move is designed to bolster the stability of Nigeria’s financial system and avert potential systemic risks.
The statement read, “The Central Bank of Nigeria has granted approval for a pivotal financial accommodation to support the proposed merger between Unity Bank Plc and Providus Bank Limited. This strategic move is designed to bolster the stability of Nigeria’s financial system and avert potential systemic risks.
“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. 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.”
There have been strong indications for over a year on plans by Providus Bank Limited to acquire a majority stake in Unity Bank Plc.
The development was part of ProvidusBank’s expansion plan and, importantly, a bold initiative to shore up its capital base further amid the current recapitalisation challenge.
In 2018, Milost Global Inc., a New York-based private equity firm, botched a move to invest $1bn in the bank. Since then, the bank has been seeking a preferred suitor.
Unity Bank commenced operations in January 2006, following the merger of nine banks with competencies in investment, corporate, and retail banking.
