February 18, (THEWILL) — The proposed merger between Providus Bank and Unity Bank Plc has stalled after regulatory concerns emerged over insider-related loan exposures, shifting attention from strategic consolidation to governance and compliance.
Sources indicate the Central Bank of Nigeria is reviewing loans linked to directors, shareholders, and related parties to ensure they meet prudential guidelines on transparency, arm’s-length terms, and performance status. The regulator has reportedly requested additional clarifications and possible restructuring of certain facilities before granting approval, slowing the transaction timeline.
The merger had been positioned as mutually beneficial offering Providus scale and market expansion while providing Unity Bank an avenue to strengthen capital and operational resilience.However, insider credit issues typically attract heightened scrutiny because they directly affect risk management and corporate governance.
Analysts say the deal’s outcome will depend on how quickly the banks resolve the identified concerns, which could involve restructuring exposures, raising provisions, injecting capital, or tightening governance controls.For now, the transaction remains pending regulatory clearance, underscoring how due diligence can reshape major banking consolidations.
Ogochukwu Onwaeze is a writer specializing in business and economic journalism. At THEWILL News Media, she translates market trends, financial developments, and policy shifts into clear and engaging stories.
