Recapitalisation: Zenith Bank to raise funds in international capital market

Zenith Bank has announced plans to raise an undisclosed amount in the international and Nigerian capital markets.

According to the company, the funds shall be raised through the issuance of ordinary shares, or preference shares, whether by way of private placement, rights issue or both.

In a notice on Friday, Zenith Bank said it will hold its 33rd annual general meeting (AGM) on May 8 for the purpose of establishing a capital raising programme and conducting other special businesses.

Zenith Bank said shareholders would decide whether the company’s board of directors should be “authorised to establish a capital raising programme in the Nigerian or International capital market of up to the authorised capital of the company, through the issuance of ordinary shares, or preference shares, whether by way of a public offering, private placement, rights issue or both, or any other method or combination of methods”.

The company also said the board would propose increasing its issued share capital — from N15,698,246,893.50 to N31,396,493,787 — at the AGM.

Furthermore, Zenith Bank said the board would request at the meeting that “in the event of a Rights issue, any shares not taken up by existing shareholders within the period stipulated under the Rights issue may be offered for sale to other interested shareholders of the bank on such terms and conditions as may be determined by the directors subject to the approvals of the relevant regulatory authorities”.

Zenith Bank said the directors would be authorised to cancel any outstanding shares not required at the end of the capital raising programme.

Meanwhile, banks have been announcing plans to raise funds after the Central Bank of Nigeria (CBN), on March 28, directed commercial, merchant and non-interest banks to increase their minimum capital requirements.

CBN adjusted the capital base for commercial banks with international licences to N500 billion, while national and regional financial institutions’ capital bases were pegged at N200 billion and N50 billion, respectively.

On April 8, First Bank Nigeria (FBN) Holdings announced a plan to sell shares to private investors and existing shareholders to raise N300 billion.

Guaranty Trust Holding Company (GTCO) Plc, in a statement on Friday, disclosed the board has proposed to raise $750,000,000 by way of public offerings and private placements.