The Chairman of First HoldCo Plc, Femi Otedola, has explained the reason behind the group’s sharp decline of over 90 per cent in its 2025 financial performance.
Otedola gave the explanation via his X handle on Saturday, January 31.
He hinted that the drop was the result of a deliberate decision to fully recognise legacy bad loans.
“At First HoldCo, we decided to clean house properly. We took a huge one-time hit of ₦748bn to admit old bad loans instead of pretending they do not exist.
“That is why profit looks like it crashed by 92%. Painful headline, but it is a serious long-term move,” Otedola said.
Earlier, Pinnacle Daily reported that bad loans cut First HoldCo’s profit by 93.36 per cent.
A review of the group’s unaudited financial statements for the year ended December 31, 2025, shows that profit for the year fell sharply to ₦44.98 billion, compared with ₦677.01 billion recorded in 2024.
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The decline was largely driven by a surge in impairment charges, which rose to ₦748.13 billion in 2025 from ₦426.29 billion in 2024.
The increase reflected weaker credit quality across several loan and asset categories.
Providing further insight, Otedola said the cleanup was influenced by pressure from the apex bank on financial institutions to stop deferring problem loans.
“So First HoldCo basically closed the chapter on messy loans from past years. This sends a clear message that borrowing has consequences and helps rebuild trust,” he explained.
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He stressed that the group’s core business remains strong, adding that it generated ₦2.96 trillion in interest income and ₦1.91 trillion in net interest income, giving it the capacity to absorb the one-off loss.
“The key point is this: our business itself is still strong. Now, at @FirstBankngr and beyond, we go into 2026 lighter, cleaner and better prepared for the recapitalisation era and serious growth,” Otedola added.
Alex is a business journalist cum data enthusiast with the Pinnacle Daily. He can be reached via ealex@thepinnacleng.com, @ehime_alex on X
