The Group Managing Director, FBN Holdings Plc, Mr Nnamdi Okonkwo, has assured its shareholders that the company will attain a N730 billion capital base by the first quarter of 2025.
Okonkwo gave the assurance at the the Group’s ‘Facts Behind the Rights Issue” presentation at the Nigerian Exchange in Lagos.
He said the company at the completion of its capital raise drive would exceed the Central Bank of Nigeria (CBN) minimum recapitalisation requirement of N500 billion.
Okonkwo outlined the Group’s comprehensive strategy, which began with the raising of a N150 billion rights issue exercise on November 4, 2023.
Okonkwo disclosed that the Group’s capital base currently at N230 billion would be bolstered with the ongoing rights issue and subsequent capital raising strategies.
“This initial phase is all about securing N150 billion through our Rights Issue by offering of 5.98 billion ordinary shares of 50k each at N25 per share to existing shareholder on the basis of one new ordinary share for every ordinary shares held as at Oct. 18, 2024.
“This company’s plan to recapitalise our commercial banking subsidiary, First Bank of Nigeria Limited, (FirstBank),” Okonkwo stated.
He disclosed that FBN Holdings would seek shareholders approval to raise an additional N350 billion at the forthcoming Annual General Meeting (AGM), to reach the N730 billion capital target by early 2025.
“When we are done, we will be over N230 billion higher than the regulator-stipulated capital,” Okonkwo said.
Speaking on the right issue proceeds, he said that it would be channeled into strengthening the operations of FirstBank, financing digital banking expansion, automation, and investments across its international branches.
Okonkwo said that 9.85 per cent of the capital raised, approximately N14.73 billion would be channeled towards upgrading FirstBank’s digital banking infrastructure and automation systems.
“We will be recapitalising our flagship, FirstBank with a certain portion of the money, and deploy the rest for innovation and digitisation across our franchise.
“What will be critical to our longevity for another 130 years is for us to focus on sustainable finance, diversity, inclusion, climate action, and community development,” he said.
He added that the bank would deepen its footprint in strategic markets, including key African economies and its existing presence in the United Kingdom, France, and China.
He said N29.5 billion (19.7 per cent of the proceeds) would be used to increase its international visibility.
“The bank also plans to deepen its footprint in strategic markets, including key African economies and its existing presence in the United Kingdom, France, and China.
“This infusion of capital allows us to be more competitive on a global scale and reinforces our commitment to innovative, customer-centric services,” Okonkwo noted.
FBN Holdings’ extensive diversification strategy was also highlighted, with a focus on enhancing synergies across its subsidiaries and leveraging its stronghold in commercial and merchant banking, asset management, insurance brokerage, and other financial services.
Okonkwo addressed the decision to divest from merchant banking through FBN Quest, citing a strategic reorientation that would enable the group to focus on more profitable, scalable ventures. “Our diversified portfolio provides a buffer; if something goes wrong on one side, there’s support from another,” he said, citing the bank’s resilience amid Nigeria’s challenging economic landscape.
According to Okonkwo, the right issue price of N25 per share offers current shareholders a compelling investment opportunity, as the rights issue price is set at a discount to the current market value.
The Chief Executive Officer, Nigerian Exchange Limited, Mr Jude Chiemeka said the Exchange remains committed to provide a platform for listed corporates to raise fresh capital.
Chiemeka disclosed that Year-till-Date, the Exchange had facilitated N5.7 trillion across different asset classes, stressing that the financial services sector plays an important role in the Nigerian capital market.
“Between 2019 and 2024, this sector has traded over N8 trillion worth of securities in our equities market and 51 per cent is largely attributable to the financial services sector.
“We think with the important financial service sector plays in the economy, particularly job creations, we are glad to assist the financial services sector around their capital raising exercise,” he said.
