Zenith Bank seeks NGX approval to sell 5bn shares through rights issue

Zenith Bank Plc has sought approval from the Nigerian Exchange (NGX) Limited to sell 5.23 billion shares through rights issue to raise N188.37 billion.

According to a statement on Wednesday signed by Godstime Iwenekhai, head of the issuer regulation department at NGX, the qualification date for the rights issue is July 24.

NGX said Zenith Bank applied for the approval through Stanbic IBTC Stockbrokers Limited, the lender’s its stockbroker.

The capital market regulator said Zenith Bank plans to list a rights issue “of Five Billion, Two Hundred and Thirty-Two Million, Seven Hundred and Forty-Eight Thousand, Nine Hundred and Sixty-Four (5,232,748,964) ordinary shares of 50 Kobo each at N36.00 per share on the basis of one (1) new ordinary share for every six (6) existing ordinary shares held as at the close of business on Wednesday, 24 July 2024″.

On April 12, Zenith Bank announced plans to raise an undisclosed amount in the international and Nigerian capital markets.

According to the company, the funds shall be raised through the issuance of ordinary shares, or preference shares, whether by way of private placement, rights issue or both.

The company also said the board would propose increasing its issued share capital — from N15,698,246,893.50 to N31,396,493,787 — at the AGM.

Zenith Bank’s plan to raise capital comes after the Central Bank of Nigeria (CBN), on March 28, directed commercial, merchant and non-interest banks to increase their minimum capital requirements.

CBN adjusted the capital base for commercial banks with international licences to N500 billion, while national and regional financial institutions’ capital bases were pegged at N200 billion and N50 billion, respectively.

With a capital base of N270.75 billion, Zenith Bank needs N229.25 billion to reach the minimum capital requirement of N500 billion.