First Bank of Nigeria Limited (FirstBank) has slammed the General Hydrocarbons Limited (GHL), owned by Nduka Obaigbena over breaches in the $225 million loan deal The case is currently under litigation
The bank in a statement clarified its position while affirming its respect for the judiciary and commitment to legal due process.
According to the statement, the dispute stemmed from a loan facility extended by FirstBank to GHL for the development of Oil Mining Lease assets.
The transaction, supported by robust loan agreements, reportedly faced challenges when GHL allegedly breached the terms by diverting proceeds from the financed project.
FirstBank explained that it had sought the appointment of an independent operator to ensure transparency and accountability, a request in line with the loan agreements.
However, GHL rejected this proposal and instead demanded additional funding, which the bank declined, citing GHL’s non-compliance with the stipulated terms.
The bank noted that GHL initiated arbitration proceedings and sought preservative orders from the Federal High Court.
It said while some of these orders were granted, others were denied. FirstBank clarified that it has filed substantive claims against GHL in court, distinct from the arbitration process initiated by GHL.
FirstBank further alleged that GHL diverted crude oil proceeds from a Floating Production Storage and Offloading (FPSO) vessel, necessitating legal action to recover assets and safeguard its interests.
The bank emphasised that these measures aligned with its obligations as a secured lender.
Reiterating its long-standing commitment to supporting businesses and fostering a strong credit culture, FirstBank assured its customers and stakeholders of its unwavering resolve to deliver quality financial services.
The bank also expressed gratitude for the success of the initial phase of its parent company First Holdco Plc’s rights issue and anticipates a successful conclusion to the recapitalisation exercise.
FirstBank urged the public to disregard what it described as “sponsored but false narratives” surrounding the dispute and reaffirmed its dedication to ethical banking practices.