Unity, Providus Banks Merger Scales First Hurdle As CBN Approves Deal

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 Limited.

In a statement signed by the acting Director, Corporate Communications of the apex bank, Takamatsu Sidi-Ali, the approval of the financial accomodation for the merger was a strategic move 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.

According to the apex bank, the fund will be instrumental in addressing Unity Bank’s total obligations to the Central Bank and other stakeholders.

LEADERSHIP reports that the CBN’s action was 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. Furthermore, 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 remains 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 CBN spokesperson added.