Merger Milestone: Providus and Unity Bank Finalize Talks

Merger Milestone: Providus and Unity Bank Finalize Talks

NewsReport learned that an official announcement is expected soon after the proposed merger between Providus and Unity banks reaches the final stage,

The merger is one of three consolidations expected in early 2026 as tier-2 lenders scramble to meet the Central Bank of Nigeria (CBN) ‘s recapitalisation deadline.

Sources aware of the development — within and outside both institutions — confirmed the current status of the consolidation efforts.

In March 2024, the CBN increased the minimum capital requirement of commercial banks in Nigeria, issuing a deadline of March 2026.

The regulator raised the capital bases of commercial banks with international licences to N500 billion, while those of national and regional financial institutions were pegged at N200 billion and N50 billion, respectively.

Providus and Unity Bank Merge

The apex bank also increased the minimum capital requirement for merchant banks with national licences to N50 billion.

Since the regulatory directive was announced, banks have been scrambling to raise capital through various means, including shares and rights issuances, and private placement programmes.

In November 2025, the CBN said 16 banks had fully met the capital requirements, but that number has now exceeded 20.

Unity Bank holds a national licence, while Providus — which has successfully metits capital requirement successfully — operates in the regional banking category.

The merger talks were already in motion when the CBN announced its approval for the deal in August 2024 – months after its recapitalisation directive.

This followed approval by the shareholders of both institutions at separate extraordinary general meetings (EGMs) held as part of the business combination process, following a court order.

At the moment that the process has reached more than 90 percent completion, with only a few regulatory consents remaining.

It is also understood that both banks have been holding meetings to ease workstreams and integration processes.

Sources disclosed that teams from the two institutions have been formed to commence the integration of platforms, products, and brands.

“What is left is just to conclude the entire process,” an insider informed corresponded 

“We are counting days. What I mean is that I don’t see it exceeding one month from now for the announcement of the full merger.”

A COURT SANCTION IN ANTICIPATION

Sources within Providus Bank told TheCable that the organisation is currently awaiting a court sanction, following the successful “court-ordered annual general meeting”.

“In due time, announcements will be made,” an insider said.

“But you know that when a court orders an annual general meeting, you still need to go back to the court to say that you have done what is said to be done. And so the court will now say, this is sanctioned, you can go ahead with it. That process is on.”

UNITY BANK’S FUTURE

While the deal is expected to give the post-merger entity a balance sheet of up to N3 trillion, it serves as an escape route from collapse for Unity — a bank with a long history of struggles.

Speaking at the EGM in September last year, Hafiz Mohammed Bashir, chairman of Unity Bank Plc, said joining forces with Providus would create a stronger, more competitive, and resilient institution.

The completion of the deal is also expected to result in a new name for the enlarged entity called ‘Providus-Unity Bank (PUB)’.

Under the scheme consideration — as disclosed in a statement dated September 26, 2025 — Unity Bank shareholders will receive N3.18 per share or be allotted 18 ordinary shares of N0.50 kobo each in Providus (credited as fully paid) for every 17 ordinary shares of Unity Bank held.

“Upon completion, Unity Bank’s entire share capital will be cancelled, and the Bank dissolved without winding up, while Providus Bank Limited will retain its certificate of incorporation as the enlarged bank,” the statement reads.

In its report, titled ‘Banking Sector Prospects in Nigeria’, DataPro said the CBN’s regulatory push has “spurred an active M&A environment, but it brings with it considerable risks”.

The firm said the looming deadline has triggered “war room” discussions across the industry, focused on deal execution and risk mitigation.

However, the rating agency warned that post-merger integration challenges, such as IT system harmonisation, cultural alignment, and the migration of non-performing loans (NPLs) could strain newly merged entities, particularly smaller banks.