FBN Holdings Shareholders Protest Court Order Suspending AGM, Plan to Raise Fresh Capital

Some shareholders of FBN Holding Plc (FBNH) yesterday protested against a court order suspending the 11th Annual General Meeting (AGM) of the financial institution and management proposed plan to raise fresh capital and appoint new directors.

Displaying placards with inscriptions such as “Oba Otudeko, First Bank is not your property,’ Otudeko, First Bank is Greater than you,’ the protesters were seen chanting solidarity songs.

The shareholders, in the protest that took place at the Head office of FBNH at Marina, Lagos, decried the move by some individuals to use court to stop the AGM, noting that AGMs are statutory meeting which cannot be stopped from holding.

The management of FBN Holdings seeks to increased its issued share capital from N17.95 billion ordinary shares of 50 kobo each to N22.43 billion ordinary shares of 50 kobo each and also seek shareholders’ approval to raise fresh by means of right issue.

The lender is also seeking shareholder approval to raise funds via the creation of 8.974 billion ordinary shares at 50 kobo each.

However, a petition by Olusegun Samuel Onagoruwa upon which the order was obtained in suit No: FHC/L/CP/1271/2022, seen by press and addressed to Nnamdi Okonkwo, FBN Holdings Chairman stated, “Take notice that unless you obey the directives in the Judicial Order contained in the Order made on the 15th July, 2022, by the Federal High Court, Lagos, by refraining from proceeding with the 11th Annual General Meeting of FBN Holdings Limited proposed for 15th August 2023 from seeking approval to issue or raise share capital in any manner whatsoever, from appointing or confirming the appointment of new directors, or in any other manner taking any step towards implementing, actualising enforcing resolution of the 10th Annual General Meeting of FBN Holdings  Plc held on 20th June 2022, or in any other manner overreaching, disobeying or undermining the said Order of court, you will be guilty of Contempt of Court and you will be liable to be committed to prison and to there imprisoned.”

The Chairman of Trusted Shareholders Association of Nigeria, Alhaji Mukhtar Mukhtar, while speaking on behalf of other minority shareholders noted that shareholders were not happy that some individuals were trying to hold the financial institution to ransom.

He alleged that there were strong indications that the plot to stop the AGM was from the former Chairman of FBNH, Oba Otudeko, adding that the resolutions to raise more capital for the bank and to appoint directors into the board was met with stiff disapproval as the resolutions would cut the control the former chairman has on the bank.

They therefore want the AGM to proceed and all resolutions should be considered

“We are here to register our displeasure, our discontent, our disapproval and rejection of the attempt by some shareholders to prevent the AGM of FBN from holding and thereby preventing some resolutions from be passed. We want the AGM to proceed and the resolutions passed.

“There are strong suspicion and strong allegations, that Oba Otudeko is oiling the crisis and oiling people to approach the court. And then they want First Bank not to consider raising more capital like some of the banks are doing. And also not to appoint some directors into the board of the bank

“I think this is very improper. It is not right that some people who have benefited from the political economy of this country, are the ones holding this institution  to ransom.”

Speaking further, he said: “So I think those people that have gone to court in order to stop the AGM from holding know that it is illegal. They know that we have precedence’s, whereby Annual General Meetings are statutory meetings, nobody can stop it. Nobody can stop any activity from holding.

“We have instances from the past whereby some aggrieved individuals or parties or shareholders approached the court in order to stop the conduct of the AGM. But the judges told them that this is a statutory meeting, they cannot stop.

“They are trying to prevent the bank from holding AGM and considering some resolutions, which is to raise more capital for the banking business. You can agree with me that banking business is about capital. If there is no capital, business will collapse. And for the banking industry, capital is very, very important,” Muktar said.

While noting that several petitions had been written to regulatory bodies, the shareholders, therefore, called on the Central Bank of Nigeria (CBN), the Securities and Exchange Commission (SEC) and other regulatory bodies to take actions and look into the crisis.

“We will continue to protest. We have written petitions to the regulators and we will continue to write more petitions,” Muktar said.

“The regulators should come in. They cannot continue in their complacent behaviour in the face of abuses. They must ignite some certain regulatory powers, they can suspend the shares of those people who attempt to hold this bank to ransom.

“We cannot allow this bank to die therefore, the regulatory authorities must act now because they just cannot be quiet.”

While noting that FBNH has an important, systemic function in the economy of Nigeria as one of the few banks that stabilise most of the monetary and fiscal policy and banking practices as a whole, Mukhtar urged the regulators to allow the financial institution grow by enforcing best practices and by resolving the looming crises.

Meanwhile, a Federal High Court in Lagos has granted an application seeking substituted service on the Group Managing Director (GMD) of FBN Holdings Plc, Nnamdi Okonkwo, and two other Directors of the bank, over alleged contempt in a case filed against them by Onagoruwa.

Aside Okonkwo other alleged contemnors were Alhaji Ahmed Abdullahi, Chairman of the Board of Directors; Mr. Julius Omodayo-Owotuga, Non-Executive Director.

Justice Nicholas Oweibo, granted the application after hearing arguments from human rights lawyer and Senior Advocate of Nigeria, Ebun-Olu Adegboruwa, on behalf of the petitioner, Onagoruwa, an aggrieved shareholder of FBN Holding Plc.

The order dated July 27, 2023 read: “That an order is hereby made granting leave to the Applicant effect service of the FORM 48 dated 25th July, 2023 and all subsequent processes to be filed or issued in the contempt proceedings on the 2nd 3rd and 4th Respondents/alleged contemnors (Alhaji Ahmed Abdulahi, Mr. Julius B. Omodayo-Owotuga and Mr. Nnamdi Okonkwo) by substituted means to wit: (a) By advertisement in at least two Newspapers circulating in Nigeria and to deem such service as proper service on the 2nd Respondent; and/or  (c)By courier service of DHL Nigeria -Limited at Samuel Asabia -House, 35, Marina, Lagos, and to deem such service as proper on the 2nd, 3rd and 4^th.”

The petition filed by Onagoruwa claimed that the affairs of the company were being run illegally and oppressively.

In a 52-paragraph affidavit in support, the petitioner had stated that he was a shareholder of FBN Holdings Plc and he was not served with notice of the AGM held on June 20, 2022, at Oriental Hotel.

Consequently, the petitioner filed an affidavit of urgency in support of the application.

According to the affidavit filed in support of the motion, the petitioner averred that the matter was the decision and resolutions reached at the just-concluded Annual General meeting of the 1st respondent held on Monday, June 20, 2022.

The applicant stated that his rights to be personally served with notice of the AGM of the 1st respondent had been breached, hence the instant application.

It was further stated that it was imperative to allow the court determine all issues and reliefs sought on the merits without any interference from any party implementing, in respect to the meeting, acting on, or executing decisions reached at AGM of the 1st respondent.

The petitioner added that “there is a binding obligation upon the respondents to maintain the status quo of the subject matter of the petition and not to take any step that may overreach the petition or foist a situation of complete helplessness upon the court in the hearing and determination of the Motion on Notice for interlocutory injunction and the retition filed herein, as any step taken by the respondents to further implement or execute the decisions and resolution reached at the said Annual General Meeting of the 1st respondent held on the 20 June 2022 will undoubtedly usurp the constitutional powers and authorities of the court to determine the real issues and subject matter of the case already submitted to it by the applicant.”