The FCMB Group on Wednesday hinted of its Board plans to seek shareholders’ approval to raise about N150bn in additional capital.
The group made this disclosure in a Notice of its Annual General Meeting filed with the Nigerian Exchange Limited (NGX) on Wednesday.
The additional capital requirement plan is coming barely two weeks after the Central Bank of Nigeria (CBN) adjusted the capital base of lenders in the economy. For instance, the directive requires banks with international licences expected to raise theirs to N500bn.
To meet the requirement, the apex bank gave the banks three options, namely the issuance of new common shares (by way of public offer, rights issues, or private placements), mergers and acquisitions, and the upgrade and downgrade of their respective licence category or authorisation.
Following the regulatory directive, many of the banking groups, including Access Holdings, FBN Holdings, Guaranty Trust Holding Company Plc, Zenith Bank and United Bank for Africa, had announced plans to raise funds from both the domestic and international capital markets.
The FCMB Group in the AGM Notice stated that shareholders would be required to ratify the N150 billion capital proposal by voting on the resolution to increase the issued share capital of the group from N9.90bn divided into 19,802,710,781 ordinary shares of 50k each to N19.80bn divided into 39,605,421,562 ordinary shares of 50k each by the creation and addition of 19,802,710,781 ordinary shares of 50k.
The Notice further indicated the establishment of an Employee Share Option Programme would also be tabled before shareholders for consideration at the AGM.
Meanwhile, in the banking group’s audited report for 2023 recently published, the lender declared N104.4bn in profit before tax, indicating 186 per cent year-on-year growth, with divisions of the group recording robust earnings growth; banking group at 212.6 per cent, consumer finance at 67.3 per cent, investment management at 40 per cent, and investment banking at 89.7 per cent.
In addition, the gross revenue of FCMB Group rose by 82.5 per cent to N516.4bn from N283bn, largely driven by a 61.7 per cent growth in interest income and a 154.4 per cent growth in non-interest income.
Also, the group reported net interest income growth of 44.8 per cent from N122bn to N176.6bn last year, on the back of growth in the yield on earning assets.
As expected in a surging inflation environment, increases in personnel costs, regulatory costs, technology-related costs, and general inflationary pressures pushed the banking group’s operating expenses up by 38 per cent year-on-year to N157.2bn.
However, the group’s digital revenue improved by 62.4 per cent in 2023 to N60.3bn from N37.1bn in the previous year on the back of increasing investment in modern technologies, particularly those supporting real digital transactions
