N139bn Rights Issue: Investors Stake N4.04bn on FBN Holdings’ Shares

Kayode Tokede

As the date for its N139 billion rights issue draws nearer, investors on the Nigerian Exchange Limited (NGX), yesterday staked N4.04billion on FBN Holdings shares with speculation that top management of FirstBank were increasing their holdings in the oldest financial institution in Nigeria.

At the close of trading yesterday, FBN Holdings was the most traded stock by value and volume, followed by United Bank for Africa plc (UBA), Universal Insurance Plc, Fidelity Bank Plc and Unity Bank Plc.

Investors staked 209.90 million units and N4.04 billion by volume and value in FBN Holdings, respectably and its impact reflected on the financial institution’s stock price.

The stock price of FBN Holdings closed at N19.35 as it gained 0.52 per cent or N0.10 per share from the N19.25 it opened for trading.

Since the beginning of November 2023 trading, the stock price of FBN Holdings has gained 7.54per cent from N17.90 per share to N19.25 per share.

The Managing Director/Chief Executive Officer, APT Securities Limited, Kasimu Garba Kurfi hinted that some top management of the financial institution were increasing their holdings, adding that some loyalists of the top management of the HoldCo were also investing in FBN Holdings stock on the NGX.

“There is increasing positioning by major stakeholders in FBN Holdings, and some them are making sure their loyalists have large portion of holdings.

“The NGX could have announced if it was insider- related but we have not seen that happening for now,” he explained.

FBN Holdings had sought the approval of the  Exchange  to raise N139 billion in additional capital through a rights issue.

Its stockbrokers, FBNQuest Securities, sought approval on behalf of the lender in a notice.

Part of the notice read, “its stockbrokers, FBNQuest Securities Limited, submitted an application to Nigerian Exchange Limited for the approval and listing of a Rights Issue of 8,973,823,198 ordinary shares of 50 kobo each at N15.50 per Share on the basis of one new ordinary share for every four ordinary shares held as at the close of business on Monday, 9 October 2023.”

Meanwhile, the financial institution still has Mr. Femi Otedola as the single largest shareholder of the bank with 5.57 per cent holdings out of the total outstanding shares of 38.5 billion. The stock has a free float of about 88.9per cent.

FBN Holdings recently announced the release of its nine months financial statements for the period ending September 30, 2023, with profit before tax of about N270.3billion. This represented an increase of 156.3 per cent from N105.5 billion posted in 2022, driven by strong growth in interest income.

According to the group’s financial statements for nine months of 2023, the company’s profit after tax (PAT) was N236.4 billion, a 159,2per cent increase from the N91.2 billion recorded in the corresponding period in 2022.