First Bank intensifies recovery against high net-worth debtors

High-net-worth customers of First Bank of Nigeria (FBN) Plc are now living in perpetual fear as the bank’s management goes bullish on the recovery of outstanding loans given to businesses and individuals, Business Hallmark can report.

The bank’s debt recovery teams, BH gathered, have been going after high-net-worth borrowers, especially those in the nation’s oil and gas industry that are heavily leveraged.

As a result of this renewed debt-recovery drive by Nigeria’s oldest financial institution, indebted customers now live in perpetual fear of losing their companies and assets to the bank’s bullheaded debt recovery teams.

According to sources in FBN Holdings, the parent company of FBN, the decision to launch an operation to crack down on loan defaulters, was reached shortly after mercurial billionaire, Mr. Femi Otedola, became the bank’s largest shareholder and the defacto chairman.

The move, a source in the bank informed our correspondent, is meant to find an end to costly debt recovery efforts, as well as boosting the banks liquidity by freeing up tied up funds.

One of the companies in the cross-fire of FBN’s renewed debt-recovery drive is General Hydrocarbons Limited (GHL), an indigenous oil and gas company owned by media mogul, Mr. Nduka Obaigbena.

Debt Recovery Targets

The dispute between FBN and General Hydrocarbons Limited, which came to public light in January 2025, arose from a contractual dispute over  the operations of OML120.

In the court papers seen by our correspondent,  plaintiffs in the case, First Bank of Nigeria Ltd and FBNQuest Trustees Ltd, both subsidiaries of FirstHoldCo, alleged that GHL failed to repay over $225 million debt it’s owing it despite streams of revenue the oil firm gets daily from OML 120.

In December 2024, the plaintiffs secured a judgment from a Federal High Court in Lagos freezing GHL’s accounts.

In the judgment, the judge issued series of orders, including Mareva injunctions, to freeze assets and accounts linked to General Hydrocarbons Limited, its affiliates and directors.

The judge hinged his ruling on the allegations of unpaid loans the firm secured from lenders totaling $225.8 million.

The judge further directed commercial banks and financial institutions in the country to block the defendants’ accounts and restrict access to funds or assets up to the disputed amount, pending when final judgment is made on the matter.

“An order of Mareva injunction restraining all commercial banks in Nigeria, including Guaranty Trust Bank Limited, Access Bank Plc, Citibank Nigeria Limited, Carbon Bank, Ecobank Nigeria Plc, Fidelity Bank Plc, First Bank of Nigeria Limited, First City Monument Bank Plc, Flutterwave, Globus Bank, Jaiz Bank, Keystone Bank Limited, Opay Digital Services Limited, PalmPay Limited, Paystack Payments Limited, Piggyvest, Momo Payment Service Bank Limited, Polaris Bank Limited, Providus Bank, Stanbic IBTC Bank Nigeria Limited, Standard Chartered Bank, Sterling Bank Plc, SunTrust Bank Limited, Union Bank of Nigeria Plc, United Bank for Africa Plc, Unity Bank Plc, Wema Bank Plc, Zenith Bank Plc, and all other financial institutions operating in Nigeria, from releasing or dealing with any funds or assets due to the GHL up to the sum of $225,802,379.69, being the outstanding indebtedness on the GHL’s account with FirstBank as of 30 September 2024 in respect of the loan facilities granted to GHL by FirstBank pending the hearing and determination of the Motion on Notice for interlocutory injunction”, the presiding judge ruled.

Counter Move By GHL

The owners of GHL, however, refuted FBN’s claims, insisting that FBN Plc, and not General Hydrocarbons failed to honor agreed contracts.

According to the company’s Director of Strategy and Operations, Abdelmuiz Bello, GHL signed a legally binding, enforceable Subrogation Agreement with First Bank on May 29, 2021 with FBN agreeing to fund the oil firm’s exploration, production and development of OML 120 in exchange for sharing profit from oil proceeds at 50:50 ratio and taxes over eight years.

The oil firm explained that it was agreed that FBN’s 50% share would be used to offset its non-performing loans of about $718 million, which was discounted to $600 million to resolve its solvency issues therefrom.

The agreements it signed with FBN, GHL claimed, ensured that FBN returned to profitability with the declaration of N151billion ($377.5 million) profit for the year ending December 31, 2021, against the N302 billion loss declared in the preceding year.

GHL, however, alleged that First Bank thereafter, reneged in fulfilling its financial commitments as outlined in the agreements, leading to operational difficulties and inability to achieve its production target.

“Essentially, GHL’s grouse is FBN’s failure to meet its agreed and executed financial commitments, which GHL had believed would be made, when it signed the agreement resulting in critical challenges for the development of OML 120,”  it said.

While legal fireworks on  the operations of the oil mining licence drag on in courtrooms, FBN has successfully won the first round with a court appointed receiver to  run the embattled oil company.

Other Big Debtors

Another company facing FBN’s debt-recovery onslaught is Nigeria’s largest indigenous engineering, procurement, construction and commissioning company in the oil and gas sector, Nestoil.

The dispute between FBN Holdings and Nestoil this time, centers on a syndicated loan facilitated by FBNQuest, a subsidiary of FBH Holdings, which is in excess of $1.01 billion and N430 billion.

As the facility agent of the over N2 trillion worth disputed facility, FBNQuest acts on behalf of all lenders in administering the syndicated loan, including coordinating communication between Nestoil and the lenders.

FBNQuest, it was learnt, decided to move against Nestoil and its oil prospecting arm, Neconde, after the firms became unable to service loans debts owed to the applicant banks as of September 30, 2025.

On October 28, 2025, court appointed bailiffs, supported by armed policeman, sealed the imposing headquarters of Nestoil on Akin Adesola Street, Victoria Island, Lagos after a Federal High Court in the state authorized FBNQuest Merchant Bank and First Trustees to take control of the company’s assets.

Nestoil Limited, is however, challenging FBNQuest Merchant Bank’s allegation of its indebtedness, and accused the bank of failing to fulfill its fiduciary duties, as well as trying to take over the firm through the back door.

In a move to prove FBNQuest wrong, Nestoil, BH learnt, recently appointed 10 local and international forensic auditors to undertake proper forensic reconciliation of its loan accounts with the lenders.

“The amounts presented as representing Nestoil’s debt are incorrect and lack any proper basis.

“Only a proper forensic reconciliation would reveal whether we are indebted and the precise amount, if any,” the company stated in its court filings obtained by Business Hallmark.

Suspicious Motive

Meanwhile, financial and oil and gas experts have  questioned the timing of FBNQuest’s move to seize Nestoil’s assets.

“The timing of FBNQuest’s action is suspicious. Production on Neconde OML 42 owned by Nestoil has improved, generating significant revenue after years of operational challenges. So, there is no basis to seize the firm’s assets when it can easily earn income to service its loans.

“I see FBNQuest move purely as a move targeted at gaining control of profitable oil assets rather than merely recovering debt.

“These (takeover of GHL and Nestoil) are hostile take over attempts of producing oil assets,” one of the sources, who demanded anonymity alleged.

BH reliably gathered that FBNQuest’s attempt to take over Nestoil could be a long drawn battle as some of the local banks and foreign lenders that also gave loans to the company have filed papers in court to challenge the bank’s actions, especially the Mareva and receivership orders it obtained in court

Though BH was unable to get the official reaction of FBN to the story, a source in the group, who spoke to our correspondent on the matter, said the financial institution had not done anything wrong in its efforts to protect its interests.

“FBN has the right to take action against delinquent individuals and companies  not faithful to their loan repayment obligations.

“We’ll use all means available to deal with  debtors, who continue to pose a risk to our financial stability,” the source stated.