Billionaire businessman and Chairman of First HoldCo Plc, the parent company of First Bank of Nigeria, Mr. Femi Otedola, has defended the company’s decision to write off ₦748 billion in legacy bad loans, describing it as a deliberate clean-up rather than a sign of operational weakness.

Mr. Otedola explained that the write-off was a one-time measure aimed at addressing long-standing non-performing loans, rather than an indication of declining business fundamentals.

In a post on his official X handle on Saturday, he wrote: “At First HoldCo, we decided to clean house properly. We took a huge one-time hit of ₦748bn to admit old bad loans instead of pretending they do not exist. That is why profit looks like it crashed by 92 per cent. Painful headline, but it is a serious long-term move.”

The write-off resulted in a 92 per cent decline in the group’s profit for the period. However, Mr. Otedola stressed that the losses were exceptional and arose from the recognition of non-performing loans accumulated over several years.

He further noted that the move was in line with directives from the Central Bank of Nigeria (CBN), which has been urging banks to strengthen their balance sheets and stop delaying the recognition of bad assets, particularly ahead of the ongoing bank recapitalisation exercise.

“Because the @cenbank is pushing banks to stop kicking problems down the road. So First HoldCo basically closed the chapter on messy loans from past years, which sends a clear message that borrowing has consequences, and it helps rebuild trust,” he stated.

Mr. Otedola added that despite the substantial write-off, the group’s core operations remain strong, with interest income of ₦2.96 trillion and net interest income of ₦1.91 trillion, giving the company sufficient capacity to absorb the impact of the losses.

According to him, the clean-up is expected to enhance transparency, restore investor and public confidence, and position First HoldCo for sustainable long-term growth.