Femi Otedola drives parent firm of Nigeria’s oldest bank to $16 billion in assets

Omokolade Ajayi -
Key Points
  • Femi Otedola has transformed FBN Holdings, boosting its total assets from $8.56 billion in June 2023 to $16.6 billion by September 2024.
  • Under Otedola’s leadership, FBN Holdings reported a 128.2% profit increase in 2024, driven by rising interest income and robust financial management.
  • Otedola’s influence extends to Geregu Power, with profits surging from $7.2 million to $15.1 million in the first nine months of 2024.

In an era where African billionaires often establish their own corporate empires, Nigerian billionaire Femi Otedola has become a notable exception, leaving a lasting impact on companies he didn’t build from scratch.

Known for his transformational touch, Otedola, has taken FBN Holdings, the parent company of Nigeria’s oldest commercial bank, First Bank of Nigeria Limited, to new heights since joining the board in August 2023 and later becoming chairman. His leadership has helped push the group’s total assets past $16 billion, a milestone for the Lagos-based financial services provider.

Otedola, celebrated for spotting value and driving growth, built his early fortune as Nigeria’s largest private shipowner and later reshaped the fuel retail sector by founding Zenon Petroleum and Gas in 2003. His track record includes acquiring African Petroleum and selling a 74 percent stake in Forte Oil for $200 million. Now, his influence on FBN Holdings is setting fresh records for the 130-year-old institution.

FBN Holdings’ unprecedented financial growth

Since joining FBN Holdings as a director in August 2023 and assuming the chairman role, Otedola has guided the financial services giant from assets totaling N14.17 trillion ($8.56 billion) in June 2023 to N27.49 trillion ($16.6 billion) by September 2024.

The asset growth, driven by strategic oversight and effective financial management, underscores Otedola’s capability to drive substantial gains within a short timeframe. Without the Nigerian naira’s devaluation, the bank’s total assets would have approached an estimated $30 billion.

Amid a turbulent currency landscape, with the naira losing 70 percent of its value year-to-date, FBN Holdings remains resilient. The group’s total equity grew from N1.38 trillion ($833.9 million) to N2.6 trillion ($1.57 billion), while retained earnings surged from N397.7 billion ($240.33 million) to N1.11 trillion ($670.8 million), reflecting the lender’s robust financial health under Otedola’s leadership.

In the first nine months of 2024, FBN Holdings reported a 128.2 percent increase in profit to N610.5 billion ($371.7 million), up from N267.5 billion ($162.9 million) in the same period in 2023. This is credited to rising interest income, fee and commission income, and fair value gains on financial instruments, reaffirming the bank’s leading status in Nigeria’s financial sector.

Otedola’s journey with FBN Holdings began in October 2021 when he acquired a 5.07 percent stake. His continued stake-building has since increased his shareholding to 13.16 percent, making him the largest individual shareholder of the institution. His influence has not only bolstered FBN Holdings’ financial success but also fortified its position as one of Nigeria’s most valuable financial institutions.

Geregu Power’s dominant role in Nigeria’s energy sector

Beyond banking, Otedola’s strategic leadership is driving Geregu Power Plc to unprecedented heights. The company, under Otedola’s guidance, posted a profit increase from N11.36 billion ($7.2 million) in the first nine months of 2023 to N24.19 billion ($15.1 million) in the same period in 2024.

This 102 percent surge in revenue, from N55.75 billion ($34.5 million) to N112.58 billion ($70.2 million), reflects heightened energy sales and capacity charges that have bolstered the company’s financial position.

In addition to profits, Geregu Power has seen total assets grow from N182.04 billion ($112.4 million) at the end of 2023 to N221.09 billion ($136.4 million) as of September 30, 2024. Retained earnings increased to N48.1 billion ($30.1 million), while total equity rose to N49.34 billion ($31.2 million), marking steady financial growth.

Otedola’s investments in Geregu Power have solidified its leadership in Nigeria’s power sector, addressing infrastructure gaps and boosting economic growth. His success in both Geregu Power and FBN Holdings underscores his impact as a transformative businessman, reshaping corporate leadership in Africa.