UBA seeks NGX approval for rights issue of over 6.8bn shares following profit surge
The United Bank for Africa (UBA) has announced the submission of an application to the Nigerian Exchange (NGX) for the approval and listing of a rights issue totalling 6,839,884,274 ordinary shares (six billion, eight hundred and thirty-nine million, eight hundred and eighty-four thousand, two hundred and seventy-four).
This announcement follows the bank’s Q3 2024 financial report, which showed a 101.88 percent year-on-year rise in pre-tax profit to N194 billion and a nine-month total of N603.4 billion, reflecting steady financial growth.
The rights issue, filed through UBA’s stockbroker, United Capital Securities Limited, proposes ordinary shares priced at N35.00 each, with a nominal value of 50 kobo per share.
Structured on the basis of one new share for every existing share held, the offering is applicable to shareholders as of the qualification date, November 5, 2024.
This was confirmed in a statement signed by Godstime Iwenekhai, Head of the Issuer Regulation Department, noting that the application is now awaiting NGX’s review and approval.
UBA reported notable growth in Q3 2024, driven by improvements in revenue and profitability, with interest income accounting for 77 percent of gross earnings.
Despite a 19 percent decline in Q3, interest income from loans and advances to customers contributed 40.4 percent of total interest income for the quarter and 37 percent over the nine-month period.
In contrast, interest income from investments in securities rose, contributing 35 percent in Q3 and 42 percent cumulatively over the first nine months, driven by strong performance in the first half of the year.
The report showed a 101.88 percent year-on-year rise in pre-tax profit to N194 billion, with a nine-month total of N603.4 billion, reflecting steady financial growth.
UBA’s stock performance in 2024 has reflected both market conditions and investor sentiment.
Starting the year at N25.65, the stock faced early declines, dipping to N24.40 by January’s close. February extended the downward trend, but March brought a recovery with a 24.16 percent gain.
In the second quarter, recapitalization news led to further declines, with the share price falling to N20.30 by the end of July.
The narrative shifted in August as the stock rebounded, closing above N22 with trading volumes of 510 million shares.
By September, UBA shares climbed to N28.30, and in October, the stock crossed N29, buoyed by increased trading activity.
The rally continued into November, with the share price surpassing N35 on November 5, highlighting renewed investor interest in the bank’s stock.
UBA’s rights issue represents a step toward enhancing its capital position while positioning itself for potential future growth.
