Fidelity Bank Targets Regional Expansion With N127.1bn Capital Raise

By Adedapo Adesanya 

Nigerian lender, Fidelity Bank Plc, is targeting the expansion of its domestic business as well as breaking into Western and Southern African markets as it opens the application for its N127.1 billion combined rights issue and public offer, in the first capital raising under the banking recapitalisation exercise mandated by the Central Bank of Nigeria (CBN).

Recall that in March 2024, the CBN announced revised minimum capital requirements for Nigerian banks and for lenders like Fidelity Bank with international presence, the benchmark was N500 billion.

The bank’s shareholders had already approved the rights issue and public offer at the extraordinary general meeting (EGM) held in August 2023.

Speaking at the company’s Fact Behind the Combined Offer, held at the Nigerian Exchange Limited (NGX) on Thursday, the chief executive of the bank, Mrs Onyeka Onyeali-Ikpe, said the N127.1 billion offer will help the bank meet its expansion plans.

“This presents an opportunity for a stronger financial institution, proceeds from the N127.1 billion will be instrumental in driving our business and regional expansion, expanding our footprint, and unlocking business opportunities,” she said.

She further noted that Fidelity Bank will be aspiring to expand its service footprints to select African countries, with current priorities set on West and South Africa, adding that the lender will be taking a cautious approach while prioritising a value-driven approach in its foreign market entry.

The bank will seek to expand to other climes after making its foray with the acquisition of Union Bank in the United Kingdom, now known as FidBank (UK) Plc in 2023.

On the domestic front, she added that Fidelity Bank would be looking to capitalise on opportunities present in Nigeria by expanding its existing domestic businesses, adding that it would also undertake landmark projects and business initiatives that will redefine its business structure.

“This will help us diversify earnings and grow market share in the real sector of the economy. It will also allow us to increase capacity to support businesses and customers,” she added.

Responding to the expansion approach, she said the bank would look at valuable banks that it can scale based on their existing structures.

“There is already capacity and we will be able to scale,” she noted.

Business Post reports that Fidelity Bank is offering a rights issue of 3.2 billion ordinary shares of 50 kobo each at N9.25 per share. The bank is also simultaneously offering 10 billion ordinary shares of 50 kobo each to the general investing public at N9.75 per share.

The acceptance and application lists for the rights issue and public offer, which are now open will close on Monday, July 29, 2024.

The rights issue has been pre-allotted based on one new ordinary share for every 10 existing ordinary shares held as of the close of business on Friday, January 5, 2024.