Access Bank to raise $420million in rights issue

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By Alex C

Access Bank plc, with operations in eight other countries, plans to raise N68 billion ($420 million) in a share sale as it pursues expansion and stronger cash reserves. Shareholders are expected to vote on October 13, on the proposal to sell shares to existing investors.

The Nigerian Stock Exchange (NSE) suspended movements in the bank’s share price until January 27, to “preserve shareholders’ value” before the planned stock sale. Nigerian banks are preparing to sell equity and debt after the central bank last month changed the way lenders calculate capital buffers.

However, the Central Bank of Nigeria (CBN) is seeking to increase banks’ ability to withstand losses five years after saving the industry from collapse. The Apex Bank removed some assets lenders can count as capital in preparation for the implementation of Basel II and III, while limiting Tier 2 capital to 33 percent of Tier 1 capital, according to an August 5 circular.

Access Bank received shareholder approval to raise $1 billion by methods including debt and equity funding, CEO, Herbert Wigwe said April 30. The bank’s shares were unchanged at N9.59 at close in Lagos, paring this year’s decline to 0.1 percent.

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