FBN Holdings Sets N730bn Capital Base By Early 2025

FBN Holdings is on track to raise its capital base to N730 billion by the first quarter of 2025, a strategic move aimed at surpassing the Central Bank of Nigeria’s (CBN) minimum capital threshold of N500 billion for banks with international operations.

The Group Managing Director and Chief Executive Officer, Mr. Nnamdi Okonkwo, shared this ambitious plan during the “Facts Behind the Rights Issue” event, emphasising the institution’s commitment to robust growth and enhanced market positioning.

This capital increase journey begins with a N150 billion rights issue, which commenced on November 4, 2023.

Through this initiative, FBN Holdings will offer 5.98 billion ordinary shares at 50 kobo each, priced at N25 per share—a discount designed to attract existing shareholders.

This offer is based on a one-forsix rights issuance for shareholders as of October 18, 2024. Okonkwo highlighted that this initial capital raise would enable the group to recapitalize First Bank of Nigeria Limited, its commercial banking subsidiary, laying the foundation for further growth and stability.

Okonkwo encouraged shareholders to seize this opportunity by purchasing their rights in full or in part, with the option to apply for additional rights. He also noted that shareholders could trade rights via stockbrokers or directly on the Nigerian Exchange Limited (NGX) platform.

However, he cautioned that those who forgo this opportunity risk seeing their holdings diluted. Looking ahead, FBN Holdings will seek approval at its upcoming Annual General Meeting (AGM) to raise an additional N350 billion, ultimately pushing the capital base to the N730 billion target.

The proceeds from this capital raise will fund key strategic initiatives, primarily to reinforce First Bank’s operational resilience and finance an expansion in digital banking, automation, and branch investments across international locations.

Okonkwo underscored that these capital enhancements will allow the bank to expand its footprint in priority markets, including African economies, as well as its established presence in the United Kingdom, France, and China.

“This capital infusion not only strengthens our competitiveness on a global scale but also supports our commitment to delivering innovative, customer-centric services,” he remarked.

FBN Holdings is also pursuing a broad-based diversification strategy to create synergies across its financial services subsidiaries, which span commercial and merchant banking, asset management, and insurance brokerage.

A recent decision to divest from merchant banking via FBN Quest marks a shift in focus towards scalable and more profitable ventures. Okonkwo noted that this diversified portfolio acts as a financial buffer, cushioning against adverse conditions in Nigeria’s challenging economic environment.