Recapitalisation: Wema Bank gets regulatory approval for N40bn rights issue

Financial Markets

Wema Bank has received regulatory approval for the allotment of its N40bn rights issue which was initiated in December 2023.

This marks the conclusion of the first tranche of its recapitalisation exercise which commenced before the

Central Bank of Nigeria directed banks in the country to increase their capital base.

A statement from Wema Bank on Friday indicated that both the Central Bank of Nigeria and the Securities and Exchange Commission have approved the N40bn rights issue.

With this approval, Wema Bank has now successfully raised the first tranche of its plan in the minimum requirement issued by the CBN.

Wema Bank’s Managing Director/Chief Executive Officer, Moruf Oseni, in his comments on the approval, reiterated the bank’s resolve to retain its Commercial Banking licence with National Authorisation, adding that the N40bn rights issue is a step in that direction.

He said, “We are delighted to announce the conclusion of the first tranche of our Capital Raise Programme, after obtaining the relevant approvals of all regulatory authorities. Our move to commence our Capital Raise Programme very early demonstrates our push for excellence and with a strong emphasis on our digital play, we are set to amass more successes in the coming months.

“We were impressed by the vote of confidence given by our shareholders during the first rights issue exercise as our shares were fully subscribed. In addition, we obtained the approval of shareholders at our 2023 Annual General Meeting to raise an additional N150bn to meet the capitalisation threshold set by the CBN. The process is expected to be completed within 12-18 months. We are committed to providing optimum returns for every stakeholder and the successful conclusion of this N40bn rights issue is a bold step in the right direction.”

Meanwhile, Wema Bank has said that it will take legal action over reports that its banking licence is about to be revoked by the Central Bank of Nigeria.

The bank’s corporate rating was recently upgraded to BBB+ by Pan African credit rating agency, Agusto and Co, and retained at BBB by an international rating agency, Fitch.