Nigerian Bank Set to Meet New CBN Capital Requirement, Shares More Plan

• Fidelity Bank Plc is making impressive strides toward fulfilling the recapitalization objectives established by the CBN
• After the successful conclusion of the first phase of the bank's capital-raising initiative, investor confidence is at an all-time high
• The bank looks to be in a position to reach the regulatory barrier and support its long-term growth trajectory

Legit.ng journalist Zainab Iwayemi has 5-year-experience covering the Economy, Technology, and Capital Market.

Fidelity Bank Plc is making remarkable progress and is on its way to meeting the recapitalization goals set by the Central Bank of Nigeria (CBN)

Daily Champion reported that Investor confidence in the bank is at an all-time high following the successful completion of the first phase of its capital-raising initiative, which was oversubscribed by 238%, and the expansion of its share price by more than 100%.

The bank appears to be in a position to reach the regulatory barrier and support its long-term growth trajectory after successfully completing phase 1 of its capital increase.

Read also

Banks' loans to private sector decline in 2025, N1.59 trillion less than January 2024

Following the completion of its equity capital offering, the public offer was oversubscribed by an incredible 237.92%. This corresponds to 107,588 legitimate applications for 23,768,724,000 common shares, which is worth N231.7 billion.

The Rights Issue also performed exceptionally well, with 6,903 valid applications for 4,407,252,795 ordinary shares, worth N40.7 billion, and a record 137.73% subscription rate.

The CEO and managing director of Fidelity Bank, Dr. Nneka Onyeali-Ikpe, expressed sincere appreciation for the tremendous support from investors.

She said,

“The positive results recorded in our Combined Offer are a testament to the strength of the Fidelity Bank franchise in the capital market.” Such a robust response not only underscores investor confidence but also reaffirms the bank’s unwavering commitment to delivering innovative financial solutions and sustainable returns to its stakeholders.

Fidelity Bank has obtained shareholder approval to begin the second phase of its capital-raising efforts in the wake of this outstanding performance. Among other things, the bank's issued share capital increased significantly from N26.7 billion to N36.7 billion.

Read also

Wema Bank makes big announcement after increasing workers salary

At an Extraordinary General Meeting on February 6, 2025, shareholders approved the creation of an additional 20 billion ordinary shares at a price of N0.50 each, thereby endorsing this expansion.

This strategic capital boost positions Fidelity Bank to meet the CBN’s new minimum regulatory capital requirement of N500 billion for banks with international authorization before March 31, 2026. This ambitious goal aligns seamlessly with the bank’s vision for sustainable growth and exceptional service delivery, setting the stage for a dynamic future.

The performance of Fidelity Bank's stock has further cemented the bank's position as a leading player in the financial industry. Shares surged to a high of N21.15 on February 7, 2025, from an original offer price of N9.75 per share during the Public Offer, marking an amazing growth rate of more than 116%.

Apel Asset Limited experts have noted an amazing 80% return on investment for owners who have held shares since 2023, placing Fidelity Bank among the market's top-performing financial institutions.

Read also

FAAC report indicates NNPCL removed N13.7trn from FG's account

Market analysts project a considerable upside potential of 28.88%, establishing a fair value of Fidelity Bank at N23.15 against a reference price of N19.50. Such promising indicators not only enhance investor confidence but also position Fidelity Bank as a compelling investment opportunity within the Nigerian banking landscape.

Fidelity Bank Declares 159% Increase in Profit

Legit.ng reported that in the first half of 2024, Fidelity Bank, a tier-two bank in Nigeria, recorded an after-tax profit of 159%.

In H1, the bank's after-tax profit increased to N159.8 billion from N61.9 billion during the same time the previous year, per the bank's financial statement that was made public on the Nigerian Exchange Group.

The bank announced a 107% increase in gross profits from N247.1 billion to N512.8 billion.

Source: Legit.ng