THE Nigerian banking sector witnessed significant developments last week, with Zenith Bank and Wema Bank making notable strides in their recapitalization efforts.
As banks adapt to evolving regulatory requirements, both financial institutions have taken strategic steps to bolster their capital bases, ensuring long-term stability and competitiveness.
Zenith Bank Plc announced that it had received full regulatory approval from the Central Bank of Nigeria (CBN) and the Securities and Exchange Commission (SEC) for its recently concluded hybrid offer. The offer included:
A Rights Issue of 5,232,748,964 ordinary shares at N36.00 per share, which was fully subscribed at 100.18 percent.
A Public Offer of 2,767,251,036 ordinary shares at N36.50 per share, which saw an overwhelming 160.47 percent subscription rate. Following the CBN’s capital verification exercise, 4,440,587,250 shares were allotted.
Wema Bank also announced plans to raise N200 billion in fresh capital through a Rights Issue and a Special Placement Exercise, set to commence on April 1, 2025. This represents the second and final tranche of its capital-raising initiative, following the N40 billion raised in the first tranche. The additional capital will position Wema Bank above the CBN’s minimum capital requirements for a national banking license.
The banking sector’s strong performance was reflected in the NGX Banking Index, which surged by 6.74 percent week-on-week (W-o-W) to close at 1,190.35.
Tier 1 Banks: Zenith Bank led the week’s gainers with an 11.21% increase, followed by UBA (10.88%) and AccessCorp (9.01%).
Tier 2 Banks: Wema Bank recorded the highest gain in its category, rising by 25.82 percent, followed by FCMB (17.55%) and Stanbic IBTC (11.72%).
The recapitalization efforts of both Zenith Bank and Wema Bank reflect a broader trend of strengthening financial institutions in Nigeria’s banking sector as lenders prepare for increased regulatory demands and future economic growth.
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