FBN Holdings' management has allocated approximately N103.1 billion for its corporate and retail lending sectors as part of its strategy to raise N150 billion from existing shareholders.
Recently, the company held a signing ceremony to commence a rights issue, offering 5,982,548,799 ordinary shares at 50 kobo each, priced at N25.00 per share.
The existing shareholders are offered this opportunity to purchase new ordinary shares in a ratio of one new share for every six shares held as of October 18, 2024.
The financial institution intends to raise approximately N150 billion through this rights issue. As outlined in the offer prospectus, N77.34 billion is allocated for corporate lending, while N25.78 billion is designated for retail lending. These allocations collectively account for 68.95 percent of the proposed rights issue amount.
Furthermore, an additional N29.46 billion has been earmarked for the expansion of international business operations, while N14.73 billion has been allocated for investments in automation and digital banking initiatives.
With respect to these investments, the institution reaffirms its unwavering commitment to delivering a seamless banking experience for its valued customers. This commitment will be realized through substantial advancements in automation and the adoption of cutting-edge digital technologies. In particular, the institution will focus on enhancing its mobile banking application, FirstMobile, and its internet banking platform, FirstOnline.
The bank has successfully engaged a diverse demographic through FirstMobile and the new Lit App, offering a clear value proposition for customers to manage their accounts and access various financial services conveniently.
In line with its dedication to delivering a superior electronic banking experience, First Bank plans to enhance both FirstMobile and FirstOnline with additional features and services while promoting customer engagement with these platforms.
The proposal is an integral component of the company's strategy to strengthen its commercial banking subsidiary, First Bank of Nigeria Limited, aimed at enhancing the bank's capacity for business development and expansion.
Olufemi Otedola, Chairman of FBN Holdings, emphasized in a statement that shareholders should support the Rights issue by accepting their rights, as this will position the company to meet its strategic goals and provide better returns for all stakeholders in the future.
He urged shareholders to thoughtfully evaluate this investment opportunity and fully exercise their rights, as the company seeks to capitalize on upcoming opportunities and fulfill its commitments.
Additionally, he encouraged shareholders to back the company's ambitions by participating in the rights issue, thereby fortifying both the company and the bank for future growth and improved performance.
He noted that this initiative is expected to significantly enhance Total Shareholders’ Return (TSR) in the medium term and restore the bank's esteemed status among financial institutions.
During the signing ceremony, Mr. Nnamdi Okonkwo, the Group Managing Director of FBN Holdings, noted that the rights issue enables shareholders to preserve their proportionate ownership in the company while also providing crucial capital buffers to capitalize on business opportunities in the markets where the company operates.
The rights issue, which commences today, November 4, 2024, and concludes on December 12, 2024, is projected to significantly increase the market capitalization of the Holdings to N1.047 trillion upon its completion.
As of November 1, 2024, the stock price of FBN Holdings on the Nigerian Exchange Limited (NGX) stood at N27.00 per share.