Rahma Ahmed
By Ahmed Rahma, Adedapo Adesanya
To say that the past few days have not been challenging for First City Monumental Bank (FCMB) will almost mean that 2020 was a perfect year for the world.
The financial institution has had to look for ways to address the alleged extramarital affairs involving the Managing Director of its banking arm, Mr Adam Nuru, and a former employee of the lender, Mrs Moyo Thomas.
The social media space has practically been set ablaze over the issue, with some commentators calling for a mass closure of accounts with the bank.
But the management of FCMB has come out to say it would look into the matter to determine if any of its ethics were violated by the head of the lender.
At the stock market, shares of FCMB Plc, the parent company of the bank, have not been spared as the equities depreciated on Monday, the first trading session of the year 2021, by 6.0 per cent or 20 kobo to close at N3.13 per unit.
On Tuesday (today), the sell-off continued, causing the company’s shares to further go down by 12 kobo or 3.8 per cent to close at N3.01 per share.
But despite the issues surrounding the company, one of the investors of the bank, Primrose Investments Limited, has shown strong confidence in the stocks.
Almost when the news broke, Primrose, on December 31, 2020, purchased 20 million units of FCMB shares at the stock market at N3.33 each.
Business Post reports that Primose is a firm linked to the founder of FCMB, Mr Subomi Balogun. One of his sons, Mr Jide Balogun, is in charge of the real estate company.
On the day this transaction was executed, shares of the bank appreciated by 10 kobo to N3.33 per unit with a total of 24.3 million units of the company’s equities traded.
It was observed that yesterday, about 19.7 million shares of the company were traded at the NSE and today, a total of 26.6 million units were exchanged by investors.
What this means is that a few smart investors are mopping up the shares of FCMB from the market because they believe in the value they can get from the securities when the storm is finally over.
FCMB has been one of the good banking stocks in its category (tier-II), with a good price appreciation and dividend payment. About a year ago, the stock was selling below N1.50 each. The company also paid dividends to shareholders for the 2019 financial year and it is expected to pay for the 2020 fiscal year in the next few months.
