Nigerian lender, Wema Bank Plc, saw its market value decline slightly to N86.149 billion on Friday due to selloffs. Ahead of its annual meeting with shareholders, the bank?s share price has plunged more than 46% behind its 52 week high.
Due to early rally in 2024, Wema Bank Plc share price had surged to N12.50 ? the highest it has attained in 52 week. Still, market price remained above the lowest seen in the last 52 weeks post share cancellation.
Management has hinted about plan to raise capital amidst the ongoing banking sector recapitalisation. Wema Bank is expected to increase its capital base to N200 billion by the end of Q1-2026.
The regulatory notice demands that local lenders capital raising, merger and acquisition plans have to be communicated to the Central Bank of Nigeria by April 30, 2024. Analysts said 24-month timeline for accomplishing this capital raise should enable banks to seek out the best route to recapitalize without negatively impacting business operations.
On Tuesday, Wema Bank will hold its annual general meeting with shareholders to discuss the lender?s audited report for 2023, declared dividend and elect/approve directors appoitments. The bank would also seek shareholders? approval to approve N146 million annual fees for directors.
That the issue and paid up capital of the bank be increase from N6.429 billion to N25 billion. Likewise, board of directors seek to increase shares from 12,858,155,369 to 50,000,000,000 ordinary share of 50 kobo by creating additional ordinary shares total 37,141,844,640 of 50 kobo, each ranking pari passu with existing ordinary shares.
Board of directors will be seeking approval from the shareholder to raise additional N200 billion or such other amount that would enable the bank to meet CBN recapitalisation directive for a national licensed banks and meet its business needs.