First HoldCo, FCMB Stand Firm on Dividends Amid CBN Forbearance

First HoldCo and FCMB Group have both reiterated their commitment to sustaining dividend payments in 2025, even as they continue to navigate regulatory forbearance measures issued by the Central Bank of Nigeria (CBN).

First HoldCo Plans Capital Raise to Exit Forbearance

First HoldCo stated it remains focused on exiting the CBN’s regulatory forbearance regime before the end of 2025. The company noted that it is currently finalising plans to complete its capital raise in the second half of the year.

Related News:

• Zenith Bank Targets Exit from CBN Forbearance Regime by End of June
• FCMB Assures Dividend Stability Amid CBN Directive

According to a corporate disclosure filed with the Nigerian Exchange, the firm emphasized its diversified structure as a financial holding company and confirmed its intention to continue dividend payouts in 2025 and beyond.

The group clarified that the Single Obligor Limit (SOL) breach by its main subsidiary, First Bank of Nigeria, resulted from exposure to two clients with foreign currency loans, whose obligations were affected by the significant naira devaluation in 2023 and 2024. It also noted that forborne loans within the bank are tied to syndicated facilities in the oil and gas sector.

Efforts are underway by the consortium of lenders to restructure these loans, aligning repayment terms with operational cash flows. The company added that some of the underlying projects have resumed production, while others are awaiting payments from government agencies. Should any facilities remain unadjusted, full provisioning will be made to enable the exit from forbearance.

FCMB Reports Major Progress in Reducing Forbearance Exposure

FCMB Group also provided updates on its compliance efforts, revealing that its forbearance-related exposures have been reduced by over 60%, falling from ₦538.8 billion in September 2024 to ₦207.6 billion by May 2025. These exposures are tied to three entities and two obligors and are currently classified as Stage 2 loans.

The bank noted it has consistently provisioned for these facilities over the years and is optimistic about exiting the forbearance regime soon. While this may cause a short-term spike in non-performing loans (Stage 3), FCMB anticipates the ratio to fall below 10% of its total loan portfolio by year-end, aided by expected loan book expansion.

To resolve a breach of the Single Obligor Limit, FCMB disclosed that a ₦23.1 billion convertible loan has been restructured into equity. This move is expected to lift the bank’s capital to ₦267 billion, keeping it well above minimum regulatory requirements.

Dividend Outlook and Group Resilience

Despite the CBN’s suspension of dividends and other capital distributions for banks under forbearance, FCMB expressed confidence in its dividend stability due to its diversified income sources. In 2024, only 46% of its total dividend payout originated from its Nigerian banking operations, with the rest coming from non-bank subsidiaries.

The group expects to maintain its dividend policy, assuming no major disruptions, and continues to pursue regulatory approvals to strengthen its capital buffers further.

Both financial institutions are among several banks impacted by the CBN’s recent directive requiring a pause in dividend disbursements, bonuses, and foreign investments as part of broader measures to enhance sector stability ahead of the 2026 recapitalisation deadline.

As scrutiny around the capital adequacy of Nigerian banks intensifies, First HoldCo and FCMB’s proactive steps signal a determination to remain compliant while preserving shareholder value.