Fidelity Bank Plc has announced that it has gotten the go-ahead from its shareholders to conduct the second leg of its recapitalisation exercise by way of private placement. The shareholders gave their permission through a resolution during an Extraordinary General Meeting held on February 6th, 2025.
This announcement was made in a statement to the corporate disclosure of the Nigerian Exchange Group (NGX).
Per the statement, shareholders approved for the board of the Bank “to issue, by way of one or more private placements, up to 20 billion ordinary shares of N0.50 kobo each in the share capital of the company (being not more than 30 per cent of the company’s existing issued shares and paid-up capital).”
The private placement can be made to one or more investors to be determined by the board who will also set the tranches, pricing, times, terms, and conditions.
Continuing, the shareholders directed that the private place must be carried out in conformity with applicable laws and subject to the procurement of relevant regulatory approvals.
Fidelity bank’s recapitalization journey
Following the Central Bank of Nigeria’s directive for banks to increase their share capital to the new designated minimums before March 31st, 2026, Nigerian banks have been in a race to beat the deadline, Fidelity bank inclusive.
Prior to its approved second phase of capital raising, the bank had previously announced that it had completed the first phase of its recapitalisation via a combined public offer and rights issue in 2024.
Both offers were oversubscribed, with the public offer receiving a total of 107,588 total applications for 23,768,720,000 ordinary shares valued at ₦231.7 billion. The public offer was oversubscribed by 237.92%.
The Rights Issue received 6,903 valid applications for 4,407,252,795 ordinary shares valued at ₦40.7 billion. The rights issue was oversubscribed by 137.73%.
The second phase of the capital raise will augment the bank’s available share capital of ₦36.7 billion divided into 53,400,000,000 ordinary shares of N0.50 Kobo each, in a bid to reach the ₦500 billion for the internationally licenced banks division that the bank falls under.
The bigger picture
With this recapitalisation exercise, banks whose share capital can not meet the new benchmark have the option to explore the route of merger and acquisition or risk being demoted to the banking strata where their current share capital by March 31st 2026 falls into.
Banks like Access, GTCo and FCMB have made tremendous progress in the recapitalization race, with Access raising ₦600 billion, an excess of ₦100 billion, of the minimum ₦500 billion capital for internationally licenced banks.
The March 31st 2026 deadline, though a year away, is actually around the corner. It is hoped that more banks achieve their capital requirements before the deadline to be on CBN’s safe side.
