The Central Bank of Nigeria (CBN), on Tuesday, announced its acceptance of a crucial financial accommodation to support the proposed merger of Unity Bank Plc and Providus Bank Limited.

The information was disclosed in a statement signed by Hakama Sidi-Ali, the acting director of corporate communications at CBN.

The approved merger of Providus Bank and Unity Bank represents the first merger authorised after CBN’s mandate to increase the minimum capital base.

The statement read: “The merger is contingent upon financial support from the CBN. The funds will be instrumental in addressing Unity Bank’s total obligations to the Central Bank and other stakeholders.

“It is important to note that the CBN’s action is in line with the provisions of Section 42(2) of the CBN Act, 2007. This arrangement is crucial for the financial health and operational stability of the post-merger organisation.”

She said that it was important to emphasise that no Nigerian bank currently faced a precarious situation comparable to that of Heritage Bank, which was recently liquidated.

She said that the apex bank remained committed to safeguarding depositors’ interests and ensuring the smooth functioning of the banking sector through proactive measures and strategic interventions.

“The CBN’s decision underscores its dedication to maintaining financial stability and promoting confidence in the banking system during this transformative period,” the director said.

(NAN)