Fidelity Bank plans N26.7bn capital raise

Fidelity Bank has announced plans to increase its issued share capital from N22.6bn to N26.7bn.

The bank will achieve this by creating up to 8.2bn additional ordinary shares, each valued at 50 Kobo.

This was disclosed in a corporate notice filed with the Nigeria Exchange Limited and signed by the Company Secretary, Ezinwa Unuigboje, on Thursday.

According to the notice, this move aims to align with the new minimum capital requirements set by the Central Bank of Nigeria.

To accommodate the potential oversubscription from its ongoing public offer and rights issue, Fidelity Bank will issue 5bn new shares under the public offer and 3.2bn new shares under the rights issue.

This combined offer commenced on June 20 and is set to close on July 29. The new shares will rank equally with the existing shares, ensuring no dilution in the value for current shareholders.

It added that an Extraordinary General Meeting has been scheduled for July 26, where shareholders will vote on the proposed increase in share capital.

“That under the Company’s Public Offer and Rights Issue (the Combined Offer), which commenced on June 20, 2024, to close on July 29, 2024, the Company be and is hereby authorized to accept surplus monies arising from potential oversubscription of the Combined Offer in such proportion as may be determined by the Board of Directors (the Board), subject to the Company’s Issued Share Capital and obtaining relevant regulatory approvals.

“That the Issued Share Capital of the Company be and is hereby increased from NGN22.6bn divided into 45,200,000,000 Ordinary Shares of 50 Kobo each, up to N26.7bn by the creation of up to 8,200,000,000 additional Ordinary Shares of 50 Kobo each, ranking pari-passu with the existing Ordinary Shares of the Company, to accommodate potential oversubscription of the Combined Offer in the proportion of 5bn additional Ordinary Shares under the Public Offer and 3.2bn additional Ordinary Shares under the Rights Issue.

It noted that the virtual meeting will enable members to discuss and approve the capital raise, ensuring the bank meets the revised CBN requirements within the stipulated time frame from April 1 to March 31, 2026.

Ezinwa added that the bank requires additional capital to invest in Information Technology infrastructure, expand its business operations domestically and internationally, and enhance its product distribution channels.

These investments are intended to secure long-term profitability, competitive advantage, and increased shareholder value, positioning the bank for sustainable growth.

He noted that the bank’s board of directors has been authorised to obtain approvals from regulatory bodies such as the Securities and Exchange Commission, the Central Bank of Nigeria, and the Corporate Affairs Commission.

“The Company is on a strong growth trajectory and requires additional capital for improved profitability, expansion (domestic and international) and enhancement of its digital capabilities. Continuing advances in technology, the rapid evolution of the business of banking, and changes in the operating landscape also make it imperative that the Bank remains agile, adaptable and properly positioned to respond appropriately to developments, whilst remaining a competitive and forward-looking institution,” it noted.

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

Fidelity Bank 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.