Wema Bank to begin N40bn rights issue in August
Wema Bank Plc has concluded arrangement to commence its N40 billion rights issue to the existing shareholders of the bank in August.
Wema Bank got shareholders nod at an Extraordinary General Meeting (EGM) to raise capital of up to N40 billion by way of a rights issue to the existing shareholders of the bank by issuing two new shares for every three shares held in the reconstructed capital of the bank.
The Chief Finance Officer of the bank, Mr. Tunde Mabawonku who made the disclosure at an interactive session with journalists said the potential plan was to start engagement in June and open the process formally in August.
Mabawonku noted that the bank will utilise the raised capital to drive growth phase for the bank and accelerate improvements in the share price, deepen value creation, increase credit creation, increase digital play with technology acquisition and increase geographic expansion.
“Others include deploy one stop digital platform to strengthen digital play for the bank, increased customer acquisition and retention in the youth, SME and financial excluded segments and include valuation of financial services business because of improved size,” he said.
Mabawonku noted that ALAT, the bank’s flagship digital banking solution, continues to deliver results and recently won the Best Digital Bank of the Year Award’ 2021 adding that the transaction value grew by 106 per cent to N1.46 billion in 2021 from N709.804 million recorded in 2020.
“Wema Bank expects to close the year strongly with improved returns to shareholders,” he said.
At an Extraordinary General Meeting (EGM) held on December 31 2021, the bank was authorised to raise the capital, following the completion of the bank’s share reconstruction exercise. In addition to the raise of additional capital, the Directors were also authorised to undertake the Rights Issue on dates and terms determined by the directors themselves. At the EGM, shareholders waived their pre-emptive rights to any unsubscribed shares offered pursuant to the Rights Issue in the event of an under-subscription and thereby authorised the directors to offer/issue such unsubscribed shares at a price not less than that specified in the Rights Issue Circular, in such manner as they think most beneficial to the bank. Also, the directors were hereby authorised to approve, sign and/or execute all documents, appoint such professional parties and advisers and to perform all such other acts and do all such other things as may be necessary to give effect to the above resolutions, including without limitation, complying with the directives of any regulatory authorities.
Other resolutions among other things at the EGM include that following allotment by the Board of Directors of the shares, the shares issued by the bank pursuant to the Rights Issue or any unsubscribed shares disposed of by the Directors in accordance with Resolution 3 above be listed on the floor of the Nigerian Exchange Limited.
