Wema Bank Plc Begins N39.95 Billion Right Issue

Wema Bank Plc recently commenced its right issue to get about N39.95 billion from its existing shareholders.

According to the findings by THISDAY, the subscriptions for the rights issue would commence on Monday, December 11, 2023, and end on Friday, December 29, 2023.

Wema Bank Plc is offering a total of 8,572,103,573 ordinary shares of 50kobo each at N4.66 per share on the basis of two shares for every three shares held as of September 28, 2023; this amounts to N39.95 billion rights issue.

Yesterday, the stock price at Wema Bank closed at N5.19 per share, which means that all shareholders who participate in the exercise are getting it at a discount of N0.53 per share.

This year, Wema Bank's stock price opened trading at N3.90 per share and gained N1.29 per share, or 33.1%, when calculating Year-till-Date (YtD) growth.

Interested shareholders will be able to partake in the rights by taking two new ordinary shares for every three ordinary shares held as of the close of business on September 28, 2023.

The shares to be taken up by qualifying investors will rank on equal footing with the ordinary shares of Wema Bank.

The lead issuing house for the transaction is Greenwich Merchant Bank, while the joint issuing house is Qualinvest Capital Limited.

Speaking on this, The Executive Director, Retail and Digital Business, Mr. Tunde Mabawonku, who was the Chief finance officer of  Wema Bank, said the financial institution will raise capital to boost the growth phase for the bank and also accelerate deepen value creation, improvements in the share price, increase credit creation, increase geographic expansion, and increase digital play with technology acquisition.

He said, 

• Others include deploying a one-stop digital platform to strengthen digital play for the bank, increased customer acquisition and retention in the youth, SME, and financially excluded segments, and including valuation of the financial services business because of improved size.

Wema Bank Q3 Performance

Wema Bank's profit before tax in Q3 2023 stood at N22.15 billion, which signifies a 133.86% increase from the corresponding year, which settled at N9.46 billion in 2022.

Wema Bank's profit after tax for Q3 2023 rose to N18.88 billion from the corresponding year, which stood at N8.19 billion in 2022.

Additionally, Wema Bank's return on average equity rose to 29.32% in Q3 2023.