In response to recent media reports regarding its commercial transaction with General Hydrocarbons Limited (GHL), First Bank of Nigeria Limited (FirstBank) has issued a public statement to clarify the ongoing situation, which is currently the subject of litigation.
The bank stated that there is a valid commercial relationship between FirstBank, as the lender, and GHL, as the borrower, involving several credit facilities granted for the development of Oil Mining Lease assets. However, the relationship has soured due to GHL’s alleged breaches of their loan agreements, including the diversion of proceeds from the Floating Production Storage and Offloading (FPSO) vessel.
FirstBank emphasized that it had upheld its obligations under the loan agreements and requested an independent operator be appointed to manage the assets transparently. GHL, according to FirstBank, rejected this proposal and instead sought further funding from the bank without meeting the terms required.
In response to these breaches and with no other recourse, FirstBank approached the court to preserve assets, recover the diverted proceeds, and safeguard its interests. FirstBank’s legal action, the bank asserts, is grounded in ensuring compliance with the agreed terms of the credit facilities.
The statement further clarified that GHL’s arbitration request pertains only to preservative orders and not to substantive claims. Moreover, the court action initiated by FirstBank is focused on disputes over subsequent credit facilities, which are governed by different agreements that explicitly stipulate court resolution, not arbitration.
FirstBank reaffirmed its dedication to good governance and a strong credit culture, reiterating its commitment to supporting legitimate business endeavors and holding borrowers accountable. It also thanked shareholders for their support during the successful rights issue of its parent company, First Holdco Plc.
FirstBank assured its customers, stakeholders, and the public of its continued focus on providing top-tier financial services and maintaining strong, ethical business practices.
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