Fidelity Bank became the first bank to go public after the Central Bank of Nigeria’s March recapitalization directive, with the opening of its N127.10 billion rights issue and public offer on Thursday.
The public offering of 10 billion ordinary shares valued at N9.75 per share and the rights issue of 3.2 billion ordinary shares valued at N9.25 per share were launched by Fidelity Bank on Thursday.
During the presentation of the combined offer facts at the Nigerian Exchange Limited on Thursday, Nneka Onyeali-Ikpe, the Managing Director and Chief Executive Officer of Fidelity Bank, stated that the bank’s N127.10 billion capital raising should be regarded as a trailblazer in the banking industry’s capitalization drive.
According to Onyeali-Ikpe, “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,” she added.
Continuing, she claimed that proceeds from the capital raising activity would be important in fulfilling its strategic growth plan.
“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,” she remarked.
Represented by an independent director, Isa Mohammed, the bank’s chairman, Mustapha Chike-Obi, boasted that the firm will exceed the N500 billion capital needed for its international licence.
“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,” he stated.
Adding, Mr. Stanley Amuchie, Executive Director of Fidelity Bank, stated that the commercial bank maintained a strong market position in the Nigerian banking sector despite notable changes in the competitive environment.
“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 said.
Jude Chiemeka, the acting CEO of the NGX, also 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,” he said.
He claims that in terms of technology, the NGX is ready to take in all indicated interests.
He continued, “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.”
