Fidelity Bank’s N127.10bn public offer, a pacesetter in banking industry capitalisation — Onyeali-Ikpe

COMFORT EKELEME, Business Editor

Managing Director/Chief Executive Officer, Fidelity Bank Plc, Mrs. Nneka Onyeali-Ikpe, has described the bank’s N127.10 billion capital raising exercise as a pacesetter in the nation’s banking industry capitalisation drive.
Fidelity Bank on June 20, 2024 commenced its Public Offer of 10,000,000,000 ordinary shares of 50 kobo each at N9.75 per share and Rights Issue of 3,200,000,000 ordinary shares of 50 kobo each at N9.25 per share.
Speaking at the bank’s “N127.10 billion Public Offer and Rights Issue Facts Behind the Combined Offer” event in Lagos, Onyeali-Ikpe said Fidelity Bank is the first to launch a public offer out of the many Banks in Nigeria amid Central Bank of Nigeria (CBN) directive on banking sector capitalization in March, 2024.
According to her, the bank’s capital raising process was practically initiated after obtaining approval from shareholders in August, 2023, stressing that the exercise is part of the management’s strategic growth plan to raise additional capital to meet its growth needs.
She said, “given that Fidelity Bank has already started the process of raising additional capital ahead of CBN’s directive, requiring the banks to raise a minimum capital base of N200 billion for national banks and N500 billion for banks with international operations like ours, amongst other capital requirements.
“This didn’t come as a surprise to us. As for us at Fidelity Bank, the CBN recapitalization directive presents a significant opportunity for a stronger and more resilient banking industry.
“We have embraced the challenge as a catalyst to propel us, towards a long-term vision of becoming a market leader across every product that we offer and segment that we sell, not just in Nigeria, but as an international bank,” she said.
Onyeali-Ikpe noted that proceeds from the N127.10 billion capital raising exercise would be instrumental in achieving its strategic growth plan.
She highlighted that the funds, firstly, would be deployed to drive, business and regional expansion.
“We will strategically expand our footprints within and outside Nigeria to serve as a broader customer base and to unlock new market opportunities.
“Secondly, we will have what we call technological transformation. We are committed to leveraging proprietary technology to improve operational efficiency and deliver exceptional customer service.
“Thirdly, we intend to diversify and grow. By investing in IT infrastructure and product distribution channels, we will aim to diversify our earnings base through digitalization and business expansion.
“The offer will increase our capacity to support our customers and their businesses. In summary, this capital raise will help our customers to grow, their businesses to thrive, and their economy to prosper,” she said.
According to her, management recognized the importance of investors and are committed to delivering value to them as well.
“Our track record of accelerated growth and consistent dividend payment is a testament to this,” she explained.
Also speaking at the event, Executive Director, Fidelity Bank, Mr. Stanley Amuchie said the commercial bank has a strong market positioning in the Nigerian banking industry, stressing that notwithstanding the significant changes in the competitive landscape of the Nigerian banking sector, it has continued to perform well.
On rationale for the offer, he expressed that “Due to the advances in technology and rapid evolution of banking business, it is imperative that Fidelity Bank is properly positioned to remain a competitive and forward-looking institution.”
According to him, Fidelity Bank is seeking to undertake landmark projects and business initiatives that would redefine its business structure, diversify earnings base and grow market share in the real sector of the economy.
“Fidelity Bank plans to capitalise on the vast opportunities available in Nigeria by expanding its existing domestic business.
“The Bank aspires to expand its service touchpoints to select African countries, taking a cautious but value driven approach towards foreign market entry.
“Fidelity Bank is committed to its strategic plan of providing straight-through services that meet and exceed the needs of its growing clientele” he added on the rationale behind the N127.01 billion capital raising exercise.
He stated that the bank remains focused on growing its reach within and beyond Nigeria, amplified by the acquisition of Union Bank UK Plc.
“Sustained year-on-year growth in asset base, revenue and profit; increased capital will guarantee sustained growth and shareholder return,”
The acceptance and application lists for the rights issue and public offer, which open today, are scheduled to close on Monday, July 29, 2024.