Nigeria: Wema Bank Secures Regulatory Approval for N40bn Rights Issue

Wema Bank Secures Regulatory Approval for N40bn Rights Issue
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Wema Bank has received regulatory approval for the allotment of its N40 billion rights issue, which began in December 2023. This marks the completion of the first tranche of its recapitalization effort, initiated prior to the Central Bank of Nigeria’s (CBN) directive for banks to increase their capital base.

According to a statement from Wema Bank on Friday, both the CBN and the Securities and Exchange Commission have approved the N40 billion rights issue. With this approval, Wema Bank has successfully raised the initial tranche necessary to meet the CBN’s minimum capital requirements.

Wema Bank’s Managing Director and Chief Executive Officer, Moruf Oseni, emphasized the bank’s commitment to maintaining its Commercial Banking licence with National Authorization. He noted that the N40 billion rights issue is a significant step towards this goal.

“We are delighted to announce the conclusion of the first tranche of our Capital Raise Programme, having obtained the relevant approvals from all regulatory authorities,” Oseni said. “Our early initiation of this Capital Raise Programme demonstrates our commitment to excellence, and with a strong focus on our digital strategy, we are poised for continued success in the coming months.”

Oseni also highlighted the strong support from shareholders during the first rights issue exercise, which saw full subscription of shares. Additionally, he mentioned that at the 2023 Annual General Meeting, shareholders approved raising an additional N150 billion to meet the CBN’s capitalization threshold. This process is expected to be completed within 12-18 months. “We are dedicated to providing optimal returns for all stakeholders, and the successful conclusion of this N40 billion rights issue is a significant step in the right direction,” he added.

In a separate development, Wema Bank announced plans to take legal action against reports suggesting that its banking licence is at risk of revocation by the Central Bank of Nigeria.

Recently, Wema Bank’s corporate rating was upgraded to BBB+ by the Pan African credit rating agency Agusto & Co. and maintained at BBB by the international rating agency Fitch.

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