In a significant development within Nigeria’s financial sector, the Asset Management Corporation of Nigeria (AMCON) has divested 34 percent of its equity stake in Unity Bank Plc to Providus Bank. This transaction, executed on Thursday, September 25, 2025, marks a pivotal step in the ongoing business combination deal between Providus Bank and Unity Bank. The share transfer, conducted through a crossed deal on the floor of the Nigerian Exchange Limited (NGX), has positioned Providus Bank favorably to meet the Central Bank of Nigeria’s (CBN) recapitalization deadline of March 31, 2026. This strategic move not only enhances Providus Bank’s operational capacity but also sets the stage for a transformative merger that could reshape the competitive landscape of Nigeria’s banking industry.
Details of the Transaction
The transaction involved the sale of four billion Unity Bank shares at a price of N1.66 per share, resulting in a total deal value exceeding N6.5 billion. This significant equity transfer was executed in three separate deals on the NGX, underscoring the scale and importance of the transaction. The timing of the deal is particularly notable, as it occurred just 24 hours before a court-ordered meeting scheduled to approve the scheme of merger between Providus Bank and Unity Bank. The successful completion of this share transfer demonstrates AMCON’s confidence in Providus Bank as the preferred bidder and its commitment to facilitating a smooth merger process.
Strategic Importance of the Merger
The business combination between Providus Bank and Unity Bank represents a milestone for both institutions, particularly for Providus Bank, which is poised to leverage this opportunity to strengthen its market position. The merger aligns with the CBN’s directive for banks to meet stringent recapitalization requirements by March 31, 2026, aimed at ensuring the stability and resilience of Nigeria’s financial institutions. By acquiring a significant stake in Unity Bank, Providus Bank is well-positioned to comply with these regulatory mandates while expanding its operational footprint and diversifying its service offerings.
Providus Bank, which commenced operations in June 2017, has rapidly established itself as an innovative financial institution licensed by the CBN to provide a wide range of banking services to individuals, businesses, and institutions. The bank has built a reputation for its robust IT infrastructure and advanced digital channels, which enable it to deliver exceptional customer service. Providus Bank offers a suite of tailored financial products and solutions, including business advisory services, portfolio management, personalized relationship management, fast-tracked service delivery, and self-service solutions. Its competitive edge lies in its ability to create value for a diverse clientele, including small and medium enterprises (SMEs), high-net-worth individuals (HNIs), and institutional clients.
The merger with Unity Bank is a strategic move for Providus Bank, as it seeks to transition from a niche player to a national banking powerhouse. Unity Bank’s extensive network of over 211 branches across all 36 states of Nigeria and the Federal Capital Territory (FCT) provides Providus Bank with a ready-made platform to expand its physical presence. This is particularly significant for Providus, which has primarily operated as a digitally focused bank. By integrating its advanced technology stack with Unity Bank’s widespread branch network, Providus aims to enhance service delivery, improve cost efficiency, and unlock new value across its retail, SME, and digital banking channels.
Providus Bank’s Vision and Competitive Advantage
Providus Bank’s business philosophy is rooted in its “Future Forward Banking” ethos, which emphasizes the use of cutting-edge technology to deliver best-in-class customer satisfaction. The bank is committed to providing fast, smart, personal, and borderless banking solutions that cater to the evolving needs of its clients. Its focus on innovation has enabled Providus to emerge as one of the fastest-growing financial institutions in Nigeria in less than a decade of operation.
The bank’s competitive advantage is further bolstered by its strategic focus on supporting Nigeria’s non-oil sectors, including agriculture, mining, hospitality, e-commerce, and the arts and entertainment industries. These emerging sectors are critical to Nigeria’s economic diversification efforts, and Providus Bank has positioned itself as a key partner in their growth. Through tailored financial solutions and collaborative initiatives, the bank aims to drive economic development and create value for stakeholders in these industries.
The merger with Unity Bank aligns seamlessly with Providus Bank’s growth strategy. By acquiring Unity Bank’s assets and customer base, Providus will significantly enhance its retail banking capabilities and strengthen its SME lending pipeline, particularly in the agriculture, mining, e-commerce, hospitality, and entertainment sectors. The combined entity is expected to offer a more comprehensive suite of financial products and services, catering to a broader and more diverse customer base.
Unity Bank’s Role in the Merger
Unity Bank, established in 2006, has been a significant player in Nigeria’s banking sector, with a strong focus on retail and SME banking. The bank’s extensive branch network and established customer base make it an attractive partner for Providus Bank. However, Unity Bank has faced challenges in recent years, including financial difficulties that led to AMCON’s intervention. As a government-backed entity tasked with resolving non-performing loans and stabilizing distressed financial institutions, AMCON acquired a significant stake in Unity Bank to support its recovery.
The divestment of AMCON’s 34 percent stake in Unity Bank to Providus Bank is a critical step in the merger process. It reflects AMCON’s confidence in Providus Bank’s ability to successfully integrate Unity Bank’s operations and drive long-term value creation. The transaction also paves the way for Unity Bank’s dissolution, with Providus Bank emerging as the surviving entity in the merger.
The Court-Ordered Meeting and Shareholder Options
The court-ordered meeting scheduled for September 26, 2025, is a crucial milestone in the merger process. During this meeting, Unity Bank shareholders will vote on whether to approve the proposed merger scheme. Shareholders have two options: they can either accept a cash consideration of N3.18 per Unity Bank share or opt for a share swap, under which every 17 Unity Bank shares will be converted into 18 shares in the enlarged Providus Bank. This structure provides shareholders with flexibility, allowing them to choose between immediate liquidity or continued participation in the growth of the merged entity.
If the merger is approved, Unity Bank’s assets, liabilities, intellectual property, and ongoing legal matters will be transferred to Providus Bank. Upon completion of the merger, Unity Bank will be dissolved, and Providus Bank will assume full control of the combined entity’s operations. The merger has already received preliminary approvals from the CBN and the Securities and Exchange Commission (SEC) in August 2024, indicating strong regulatory support for the transaction. The court-ordered meeting is expected to pave the way for final regulatory sign-offs, bringing the merger closer to completion.
Benefits of the Merger
The merger between Providus Bank and Unity Bank offers numerous benefits for both institutions, their customers, and the broader Nigerian economy. For Providus Bank, the acquisition of Unity Bank’s branch network and customer base represents a significant opportunity to scale its operations and establish a stronger national presence. The bank’s expertise in digital banking and innovative financial solutions will complement Unity Bank’s established retail and SME banking operations, creating a more robust and diversified financial institution.
The merger is also expected to enhance Providus Bank’s ability to serve SMEs, particularly in key non-oil sectors such as agriculture, mining, and e-commerce. By leveraging Unity Bank’s existing SME lending pipeline and Providus Bank’s tailored financial solutions, the combined entity will be well-positioned to support the growth of these critical industries. This aligns with Nigeria’s broader economic diversification goals, as the country seeks to reduce its reliance on oil revenue and foster sustainable development.
For customers, the merger promises improved service delivery and greater access to innovative banking solutions. Providus Bank plans to integrate its advanced technology stack into Unity Bank’s branch network, enabling faster, more efficient, and personalized banking services. Customers will benefit from a wider range of financial products, enhanced digital channels, and a more extensive physical presence across Nigeria.
From a regulatory perspective, the merger supports the CBN’s efforts to strengthen Nigeria’s banking sector. By combining their resources, Providus Bank and Unity Bank will be better equipped to meet the CBN’s recapitalization requirements, ensuring their long-term stability and competitiveness. The merger also aligns with AMCON’s mandate to resolve distressed assets and promote financial stability, as the divestment of its stake in Unity Bank marks a successful exit from one of its interventions.
Challenges and Considerations
While the merger presents significant opportunities, it also comes with challenges that Providus Bank must navigate to ensure a successful integration. Merging two financial institutions with different operational models and corporate cultures requires careful planning and execution. Providus Bank will need to effectively integrate Unity Bank’s branch network, staff, and customer base while maintaining service quality and operational efficiency.
Additionally, the dissolution of Unity Bank and the transfer of its assets and liabilities to Providus Bank will require meticulous legal and regulatory coordination. The successful completion of the merger will depend on securing final approvals from the CBN and SEC, as well as addressing any outstanding legal matters inherited from Unity Bank.
The share swap option offered to Unity Bank shareholders also introduces an element of uncertainty, as the success of the merger depends on shareholder approval. Providus Bank will need to communicate the benefits of the merger effectively to secure the support of Unity Bank’s shareholders and ensure a smooth transition.
The Broader Impact on Nigeria’s Banking Sector
The merger between Providus Bank and Unity Bank is part of a broader wave of consolidation in Nigeria’s banking sector, driven by the CBN’s recapitalization requirements. As banks seek to meet these mandates, mergers and acquisitions are becoming increasingly common, as institutions look to pool resources, enhance their capital base, and strengthen their competitive positions.
This trend is expected to result in a more resilient and efficient banking sector, capable of supporting Nigeria’s economic growth and development. By combining their strengths, Providus Bank and Unity Bank are contributing to this transformation, creating a stronger, more diversified financial institution that can better serve its customers and stakeholders.
The merger also highlights the growing importance of technology in Nigeria’s banking sector. Providus Bank’s focus on digital innovation and its “Future Forward Banking” ethos position it as a leader in the adoption of cutting-edge technology. By integrating its digital capabilities with Unity Bank’s physical branch network, Providus Bank is setting a new standard for hybrid banking models that combine the best of digital and traditional banking.
Conclusion
The divestment of AMCON’s 34 percent stake in Unity Bank to Providus Bank marks a significant milestone in the ongoing merger between the two institutions. The transaction, valued at over N6.5 billion, strengthens Providus Bank’s position as it prepares to meet the CBN’s recapitalization deadline and transform into a national banking powerhouse. By leveraging Unity Bank’s extensive branch network and customer base, Providus Bank aims to deepen its retail presence, enhance its SME lending capabilities, and deliver innovative financial solutions to a broader audience.
The court-ordered meeting on September 26, 2025, will be a critical step in the merger process, as Unity Bank shareholders decide whether to approve the scheme. If successful, the merger will create a stronger, more competitive financial institution that is well-positioned to support Nigeria’s economic diversification and growth. With regulatory approvals already in place and a clear strategic vision, Providus Bank is poised to lead the way in redefining banking in Nigeria, delivering value to its customers and contributing to the stability and resilience of the financial sector.