Recapitalisation: CBN Grants Permission For Ailing Unity Bank To Merge With Providus

In a bid to bolster the stability of the nation’s financial system and avert potential systemic risks, the Central Bank of Nigeria (CBN) on Tuesday announced the approval for a pivotal financial accommodation to support the proposed merger between Unity Bank Plc and the Providus Bank Limited.

The merger, according to the apex bank upon the financial support from the apex bank will allow Unity Bank to meet its obligations to the apex bank, and other stakeholders.

This development was announced by the apex bank, in a statement by its acting Director of Corporate Communications, Hakama Sidi-Ali.

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The statement reads, “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.

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“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.