Unity Bank shareholders will, on September 26, 2025, gather for a decisive meeting that could seal the bank’s future under a proposed merger with Providus Bank Limited.
Under the terms of the scheme, shareholders are set to receive either N3.18 per share or 18 Providus shares for every 17 Unity Bank shares they currently hold. The Federal High Court in Lagos, presided over by Hon. Justice D. I. Dipeolu, issued an order convening the meeting where shareholders will deliberate on the payouts, the transfer of assets and liabilities, and other elements of the merger.
The court’s order also empowers Unity Bank’s directors to make adjustments as required by regulators, including the Securities and Exchange Commission (SEC), the Central Bank of Nigeria (CBN), or the court itself.
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If approved, the merger will see all of Unity Bank’s assets, liabilities, properties, intellectual rights, and pending litigations transferred to Providus Bank. The scheme also proposes canceling Unity Bank’s share capital, effectively dissolving the bank without winding it up, with Providus Bank’s certificate of incorporation covering the enlarged entity.
Shareholders will also vote on whether to grant directors the authority to implement the scheme and authorize Unity Bank’s solicitors to seek court sanctioning if necessary.
Backstory and Financial Underpinnings
The merger traces back to August 2024, when the Central Bank of Nigeria gave formal approval for the Unity-Providus deal. A day later, the CBN authorized a N700 billion bailout loan to facilitate the recapitalization of the new banking entity, marking the first major Nigerian banking merger in five years.
The deal was projected to create a combined network of 231 branches nationwide, with CBN funding cushioning what might have otherwise been a turbulent transition.
A large chunk of the bailout was dedicated to clearing Unity Bank’s heavy debt pile:
- N303.7 billion in obligations, including N92 billion owed to First Bank of Nigeria.
- N51.7 billion owed to the CBN under the Anchor Borrower Scheme.
- N135 billion owed to NIRSAL (Nigeria Incentive-Based Risk Sharing System for Agricultural Lending).
The remainder, N392.3 billion, was earmarked for investment in a 20-year Federal Government bond, qualifying as tier-2 capital for the merged entity.
What Shareholders Should Know
The upcoming meeting will be conducted by poll, with shareholders allowed to vote in person or through representatives. Joint shareholders will vote according to the order of seniority listed in the company’s register.
Votes or instructions must be submitted to the company secretary by September 23, 2025. The results will then be presented to the court by the Chairman, Mr. Hafiz Mohammed Bashir, the Managing Director, Mr. Ebenezer A. Kolawole, or any other director appointed by shareholders.
The Merger: Lessons from History
The Unity-Providus deal brings a flashback from the Nigerian banking industry history, which has witnessed many banks collapse under the weight of a toxic balance sheet due to a lack of early intervention from the central bank.
The Nigerian banking crisis of 2009, for example, saw institutions like Oceanic Bank and Intercontinental Bank fall apart after the CBN found massive holes in their books. Unlike Unity Bank’s situation today, both banks were eventually acquired after their shareholders were nearly wiped out, with the government forcing mergers to stabilize the sector.
Similarly, Savannah Bank, once a prominent player, lost its license in 2002 after years of insolvency and could not survive because no structured bailout or merger partner was arranged in time. Shareholders in such cases walked away empty-handed.
However, the situation has since changed for the better following the recapitalization of the banks in 2004 – 2005, with the Nigerian apex bank improving its regulatory oversight to arrest situations of toxic balance sheets early on and proffer a merger solution.
Thus, Unity Bank’s ongoing merger and the CBN’s financial intervention signal a more managed approach aimed at preventing total collapse while protecting shareholder and depositor confidence.