FCMB shops for N110bn fresh capital

FCMB Group has announced plans to raise N110bn by issuing 15,197,289,219 ordinary shares of N0.50 each at N7.30 per share.

This was disclosed by the Chief Executive Officer of First City Monument Bank, Ladi Balogun, during the “Facts Behind the Offer” presentation by FCMB Group Plc at the Nigerian Exchange Limited on Tuesday.

Balogun explained that the public offer, expected to conclude by October, would be complemented by a private placement.

Looking ahead, he stated that the bank planned to raise N397bn through the selling of minority stakes in two of its subsidiaries, including the pension business and Credit Direct in 2025.

“We anticipate raising N89m to N90m from these sales, which will be injected into the bank to promote capital,” Balogun added.

He also disclosed that FCMB was in discussions with several offshore investors for a private placement.

“This will be in the form of preference shares in the holding company, downstreamed as equity to the bank, helping us achieve our target of raising N397bn. We have an aspiration to move to Tier 1.

“The first phase is what we’re currently executing. We’ll be raising a total of N150bn through both a public offer and a small private placement. This phase should be concluded by October this year,” he added.

Regarding the capital raise, Balogun mentioned that the second phase would involve selling minority interests in one or two of the bank’s subsidiaries, projected to generate between N80bn and N100bn, which would help raise the group’s total capital to approximately N250bn.

“The second phase will be selling minority interests in one or two of our subsidiaries, where we hope to generate between N80bn and N100bn. This will bring us to about N250bn. The third phase will involve a private placement towards the end of next year,” he remarked.

He stated that the proceeds from this capital raise would be allocated to drive business growth, including expanding lending to critical sectors such as agriculture, small and medium-scale businesses, and non-oil exports.

According to Balogun, investment in technology is a priority, aiming to enhance cybersecurity, improve service quality, and reduce operational costs.

Additionally, the bank plans to invest in human capital to support its growth and leadership pipeline.

Also, the Chief Executive Officer of Nigerian Exchange Limited, Jude Chiemeka, emphasised the exchange’s commitment to the green economy and technological advancements.

“We have created a system to allow our investors access to instruments with measurable Environmental, Social, and Governance impacts. This is part of our contribution to the green economy,” Chiemeka stated.

He further highlighted the role of technology in NGX’s strategy, saying, “Beyond our green initiatives, we have a robust platform that enhances corporate governance and supports seamless trading.

He added that the exchange investments in technology will ensure that brokers can trade from the comfort of their homes, even amid any disruptions.

He declared that the exchange was committed to providing financial education to its investors to empower them to make informed decisions and navigate the market more effectively.

In his remarks, the Chief Executive Officer of NGX Group, Temi Popoola, underscored the significance of digital transformation in the exchange’s operations.

  “A lot of activities are changing digitally in our markets.  Since the start of the recapitalisation process, the exchange has embraced digital solutions that enhance efficiency and transparency, Popoola stated.

In March 2024, the CBN ordered banks in the country to raise fresh capital, increasing the capital base for commercial lenders with international licenses to N500bn, those with national authorisation to N200bn, banks with regional authorization and merchant lenders to N50bn.