Honeywell Clings To Otudeko's First Bank Shares, Declares Loans As Performing

The Honeywell Group has said that contrary to popular claims, it is servicing loan facilities obtained from First Bank of Nigeria Limited and other financial institutions across the country.

The company said in its statement on Sunday that its relationship with First Bank has always been professional, at arm’s length, and in accordance with all regulatory and industry practices and norms.

It also stated that like most companies, it utilises its own equity and borrows from banks and other financial institutions to carry out its operations.

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According to Honeywell, its facilities, charged at market rates, have been performing while the bank continues to earn significant interest from them.

The statement was made in reaction to the recent uproar over the board composition of First Bank and the credit facility obtained from the bank.

The Chairman of the Honeywell Group, Mr. Oba Otudeko, was last week removed as the Chairman of FBN Holdings Plc, the parent company of First Bank Nigeria Limited.

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The Central Bank of Nigeria (CBN) turned down First Bank of Nigeria’s (FBN’s) loan restructuring for Honeywell Flour Mills and subsequently directed the bank to recover the loan granted the company immediately.

But the Honeywell Group has now said that its facilities were adequately secured with First Bank, with collaterals in place at over 170 percent of Forced Sales Value and 230 percent at Open Market Value, in accordance with the agreed terms. 

According to the Group, it had also provided additional securities in the form of FBN Holdings Plc shares, held by its Chairman, Dr. Oba Otudeko, as requested by the bank on the directive of the apex bank.