Diamond Bank Shares Rise 20% on News of Fresh Investment

By Modupe Gbadeyanka

Shares of Diamond Bank Plc appreciated on the floor of the Nigerian Stock Exchange (NSE) by 20 percent or 24 kobo last week, Business Post is reporting.

The rise came on the back of news that some new investors were planning to inject fresh funds into the company to recapitalisation as reposition for better operations.

Diamond Bank, which opened for trading last Monday at N1.20k per share, closed on Friday at N1.44k per share, after losing 5 kobo at the stock market same day.

When investors read about the anticipated capital injection last week, they quickly mopped up equities of the tier-2 bank at the stock market, causing its share price to rise.

Business Post reports that last Monday, Diamond Bank gained 3 kobo to settle at N1.23k per share and on Tuesday, it ended at N1.27k per share.

On Wednesday, it appreciated to N1.39k per share and then to N1.49k per share on Thursday before going down to N1.44k per share last Friday.

It was reported last Tuesday that four directors of the bank, including the Chairman, had been asked to make way for representatives of the new investors on the board.

On Wednesday, Diamond Bank confirmed the exit of its Chairman, Mr Oluseyi Bickersteth, Mr Rotimi Oyekanmi, Mrs Juliet Anammah and Mrs Aisha Oyebode.

However, it did not state categorically that these four directors resigned for the reason above.

Instead, the bank said they resigned from the board “with immediate effect” based on “varied personal reasons, which will include focusing on their priorities.”

After this announcement last Wednesday, Diamond Bank released its third quarter earnings for 2018 the next day, which fell below expectations.

As a result, the bank was punished for this on Friday, which resulted in the slight depreciation shares of the financial institution suffered.

Last Friday, Diamond Bank refuted media reports that some were investors were planning to release money to the firm.

“Our attention has been drawn to recent media reports concerning new equity investment in Diamond Bank Plc.

“Such reports have speculated on the identity of a new investor, with permutations on the structure of the investment.

“We wish to notify the Nigerian Stock Exchange (NSE) and the general public that these reports are far from the truth.

“Diamond Bank is not in talks with any party, global or otherwise, for any capital injection.

“While previous communication from the bank has highlighted a need to shore up the bank’s Capital Adequacy Ratio (CAR), the preferred option is an internal capital management programme that has been explained in detail to analysts and investors.

“While we recognize the need to expand our options in the short term, we have no concrete new development to report and will notify the Exchange once there is any,” Diamond Bank said in a statement last Friday.

Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

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