Otedola defends First HoldCo’s N748 billion provision for bad loans

Femi Otedola, the Chairperson of First HoldCo Plc, has provided more details on why the financial services group resolved to make a heavy provision in the sum of N748.1 billion to cover impaired loans in its unaudited financials released on Friday.

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The billionaire mogul stated in a post on X (formerly Twitter) on Saturday that the decision was imperative in light of the need to clear problem loans from past years from the books of the banking institution. He added that the step indicates that borrowing has consequences, while the move helps rebuild trust.

“At First HoldCo, we decided to clean house properly. We took a huge one time hit of N748 billion to admit old bad loans instead of pretending they do not exist,” he said.

“That is why profit looks like it crashed by 92 per cent. Painful headline, but it is a serious long term move,” he went further to say.

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First HoldCo’s impairment charge for losses in the 2025 financial year soared to N748.1 billion from N426.3 billion a year ago, indicating a 75 per cent surge, after it set aside N459.2 billion in the last quarter of last year to cover bad debts.

That provision for the last three months of the year was 7.7 per cent higher than that of the whole of 2024.

Mr Otedola’s stake in First HoldCo stood at 18.1 per cent as of 31 December 2025, according to the latest earnings report.

READ ALSO: Otedola’s shareholding in First HoldCo rises to 18%

He noted in the Saturday post that the group took the decision for the sake of credit quality and in response to the push from Central Bank of Nigeria for banks “to stop kicking problems down the road.”

According to him, First HoldCo’s business is still strong, with N3 trillion recorded as interest income in 2025, marking a 23.6 per cent jump from the N2.4 trillion reported a year earlier.

It also posted a net interest income of N1.9 trillion, up from N1.4 trillion, a strong performance which he said gave the group “the strength to take the clean up and still stay standing.”