Fidelity Bank commences N127bn capital raise

Fidelity Bank Plc opened its N127.10bn rights issue and public offer on Thursday, becoming the first bank to go public following the recapitalisation directive of the Central Bank of Nigeria issued in March.

Fidelity Bank on Thursday commenced its public offer of 10 billion ordinary shares of 50 kobo each at N9.75 per share and rights issue of 3.2 billion ordinary shares of 50 kobo each at N9.25 per share.

At the public offer and rights issue facts behind the combined offer presentation at the Nigerian Exchange Limited on Thursday, the Managing Director/Chief Executive Officer of Fidelity Bank, Nneka Onyeali-Ikpe, said the financial institution’s N127.10bn capital raising was to be considered as a pacesetter in the life of the banking industry capitalisation drive.

She noted, “Given that Fidelity Bank has already started the process of raising additional capital ahead of CBN’s directive, requiring the banks to raise a minimum capital base of N200bn for national banks and N500bn for banks with international operations like ours, amongst other capital requirements.

“This didn’t come as a surprise to us. As for us at Fidelity Bank, the CBN recapitalization directive presents a significant opportunity for a stronger and more resilient banking industry.

“We have embraced the challenge as a catalyst to propel us, towards a long-term vision of becoming a market leader across every product that we offer and segment that we sell, not just in Nigeria, but as an international bank.”

Onyeali-Ikpe stated that proceeds from the capital raising exercise would be instrumental in achieving its strategic growth plan.

She remarked, “The proceeds from this N127.1bn capital raise via the rights issue and public offer will be instrumental in achieving our strategic growth plan. These funds will be deployed to drive the following growth aspiration, business and regional expansion within and outside Nigeria, technological transformation, diversify and grow our earning base and lastly, it will help us to increase our capacity to support our customers.”

The Chairman of the bank, Mustapha Chike-Obi, represented by an independent director, Isa Mohammed, boasted that the bank would surpass the N500bn capital requirement for its international licence.

He asserted, “This is the first of a multi-stage approach that we intend to take. Not only to attain the N500bn target but we aspire to surpass it. Today, we are here to listen to a bank that has grown exponentially in four years.

“Perhaps, the kind of growth that we have had has not been seen in the financial sector and it is based on strong fundamentals, strict corporate governance and on numbers that are sustainable over the short to long terms and this has been demonstrated. Not only in our balance sheet footing, in terms of our profitability but also concerning the market. We have outperformed the All-Share Index twice in the last three years and also outperformed the banking index  four times over the last three  years with share price growth of over 250 per cent.”

Also, the Executive Director of Fidelity Bank, Mr Stanley Amuchie,  declared that the commercial bank had a strong market positioning in the Nigerian banking industry, stressing that notwithstanding the significant changes in the competitive landscape of the Nigerian banking sector, it had continued to perform well.

“Due to the advances in technology and rapid evolution of banking business, Fidelity Bank must be properly positioned to remain a competitive and forward-looking institution,” he stated.

Meanwhile, the acting CEO of the NGX, Jude Chiemeka, added, “We are delighted that Fidelity Bank has chosen this platform to communicate its financial performance, operational development and strategic plans to undertake capital raise. Your presence here underscores your willingness to provide information to the market.

 “We know that it would drive transparency in the market. I know that this is a very good day for the market. It is important to point out that we have had listings for a while and it has been by introduction. So, this is a bold step for the exchange and we are delighted that Fidelity Bank is blazing the trail.”

According to Chiemeka, the NGX is prepared technology-wise to absorb all the interests that would be expressed.

“We believe that all the investments we have made in technology will begin to materialise going forward and all the corporate governance guidelines instituted by the exchange will be respected. All of the processes that we have put in place will ensure that the interest of the market is respected,” he maintained.

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