The Central Bank of Nigeria, also known as CBN, has granted significant financial support to facilitate the proposed amalgamation of Unity Bank Plc and Providus Bank Limited.
Hakama Sidi Ali, the acting Director of Corporate Communications at CBN, disclosed this information in a statement released on Tuesday.
According to the apex bank, the approval aims to enhance the stability of Nigeria's financial system and prevent potential systemic risks.
"The merger is subject to the financial assistance from the CBN. The funding will play a critical role in addressing Unity Bank's overall obligations to the Central Bank and other stakeholders. It is important to clarify that the CBN's action is in accordance with the provisions of Section 42 (2) of the CBN Act, 2007. This arrangement is crucial for the financial wellbeing and operational stability of the post-merger entity.
"Moreover, it is essential to highlight that no Nigerian bank currently encounters a precarious situation comparable to that of Heritage Bank, which was recently wound up.
"The CBN is unwavering in its commitment to safeguarding depositors' interests and ensuring the seamless functioning of the banking sector through preemptive measures and strategic interventions.
"The decision by the CBN underscores its dedication to upholding financial stability and fostering confidence in the banking system during this transformative phase," the statement concludes.