Unity Bank Plc’s deepening financial distress is now threatening to taint its much-publicised acquisition, stoking anxiety among shareholders and market watchers despite regulatory approval from the Central Bank of Nigeria (CBN). Far from settling nerves, the CBN’s green light has instead refocused attention on the scale of the lender’s unresolved weaknesses and the risks they pose to the deal’s execution.
Behind the approval lies a bank still weighed down by severe balance-sheet impairments, legacy liabilities, and long-standing governance concerns; issues investors fear could dilute shareholder value and complicate integration as the transaction unfolds.
Unity Bank’s financial collapse was laid bare in its audited accounts for the year ended December 31, 2023, which showed a crushing loss of ₦62.6 billion, a dramatic reversal from the modest ₦941 million profit recorded in 2022. The result underscored a year in which operating costs spiraled and impairment charges tied to non-performing loans wiped out any marginal gains in revenue.
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More troubling for investors is the bank’s continued opacity. As of today, Unity Bank has yet to release its 2024 financial statements, long after its peers have published their results. The silence has intensified concerns about transparency and raised fresh questions about the true state of the bank’s finances following its merger with Providus Bank in August 2024; a deal widely viewed as a rescue rather than a strategic union of equals.
Unity Bank only released its 2023 financial statements in 2025, blaming regulatory approval delays, merger-related complexities, and extensive documentation requirements linked to financial support received from the CBN. For shareholders, however, the prolonged delays have reinforced perceptions of a bank struggling to keep pace with basic disclosure standards.
The numbers themselves are stark. Although gross earnings edged up to ₦59.36 billion in 2023 from ₦57.15 billion a year earlier, the increase was meaningless in the face of soaring expenses and loan losses. The bank posted a loss per share of 535.85 kobo, erasing any residual confidence in its earnings capacity.
Unity Bank’s balance sheet tells an even grimmer story. Total liabilities ballooned to ₦845.6 billion against assets of just ₦518.7 billion, leaving a yawning deficit of ₦326.9 billion. This imbalance dragged the bank’s capital adequacy ratio into deeply negative territory at –76.14%, far below the CBN’s 10% minimum for national banks and a clear signal of insolvency.
Auditors at KPMG did not mince words. In their report, they raised serious doubts about Unity Bank’s ability to continue as a going concern, citing its failure to meet regulatory capital thresholds and its severely eroded equity position; concerns that had already surfaced in earlier reviews of the bank’s 2022 accounts.
To stay afloat, Unity Bank leaned heavily on regulatory lifelines. The bank disclosed that it received a ₦50 billion short-term facility from the CBN to support working capital, due to mature by December 31, 2024. In July 2024, the apex bank went further, approving an additional ₦700 billion financial accommodation to prop up the merger with Providus Bank.
Rather than reassuring the market, these interventions have amplified fears that Unity Bank’s problems are being deferred rather than resolved. Investors and analysts worry that the lender’s accumulated losses, delayed disclosures, and heavy dependence on regulatory support could weigh heavily on Providus Bank after the merger.
For Providus Bank, a relatively young institution that has built its brand on governance discipline, profitability, and balance-sheet prudence, the absorption of a partner burdened with deep financial scars risks becoming a costly distraction. Without decisive cleanup of Unity Bank’s liabilities and a return to credible transparency, the acquisition risks being remembered not as a strategic expansion, but as a bailout by proxy, one that could erode confidence in the combined entity and undermine Providus Bank’s hard-won standing in Nigeria’s banking sector.
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