Fidelity, FCMB to raise N195bn from capital market


Fidelity Bank Plc and First City Monument Bank Plc will be hitting the capiatal market within few weeks to raise funds for the expansion of their operations.

While Fidelity is warming up to raise N100bn from the domestic market, FCMB plans to raise $750m (N95.25bn) from both the domestic and international capital market. Access Bank had only on Monday last week announced that it would shop for N70bn through a public offer billed to open this July.

Since the conclusion of the banking consolidation in 2005, Union Bank, Intercontinental Bank, Zentih Bank, First Bank and Oceanic Bank have accessed the market for additional funds.

The sharholders of Fidelity Bank will on Thursday approve an increase in the share capital of the bank from N10bn to N12.5bn by the creation of 5billion ordinary  shares of 50kobo each. Apart from increasing the share capital of the bank, the shareholders are also expected to authorise the directors to raise additonal capital up to N100bn.

It was learnt that the funds would be raised through a combination of convertible loans, equity or debt by way of private placement or offer for public subscription. FCMb said on Tuesday that a third of the fund would be obtained in London.

Guaranty Trust Bank Plc is currently selling global depositary receipts on the London Stock Exchange. The Chief Executive Officer, FCMB was quoted by Bloomberg News on Tuesday, as saying, “We have plans to raise another $750m of capital, primarily equity which will be followed by debt.”

“We expect that $250m of the entire capital raised will be done in the United Kingdom” by the end of this year.

The Nigerian Stock Exchange has made a deliberate attempt to build ties with the London Stock Exchange because investors  and analysts in the UK understand the country and are in much of the same zone.

About 40% of FCMB’s more than 100,000 shareholders are foreigners, including the George Soros’s Soro’s Private Equity Partners, UK-based Helios Investment Partners and the Commonwealth Development Corporation.

One thought on “Fidelity, FCMB to raise N195bn from capital market

  1. Michael says:

    Hi

    i like the entries in your blog and your aproach to investment analysis.
    About 7 more nigerian banks will be raising funds through the capital market this year. What are your thots on their outlooks.

    I would not think FirstBank has the best outlook in the short term even though its probably the least risk.

    What do you think? FCMB? Fidelity? Access? PHB? Skye? Wema? and possibly Union bank

    Diversifying in all of them will not bring the best returns, diversifyin in the 2 or 3 best prospects however just might be invaluable.

    I would like to know what are your thots?

    cheers
    Michael

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