United Bank for Africa (UBA) Plc has announced the opening of its Rights Issue of 6,839,884,274 ordinary shares of 50 kobo each at N35.00 per share aimed at raising N239.4 billion additional capital.
The Bank said on Thursday in a statement that the Rights Issue, which opened on Friday, November 15, 2024, would give existing shareholders the opportunity to purchase additional shares in proportion to their current holdings based on one new ordinary share for every five existing ordinary shares held by shareholders, as of November 5, 2024.
The Group Chairman of United Bank for Africa, Tony Elumelu, said in a letter to shareholders that following the resolution of the Group’s shareholders at the Annual General Meeting held in May 2024, authorising the establishment of the N400 billion Equity Shelf Programme, UBA would embark on a Rights Issue, as the first step in its broader capital raising programme.
“UBA’s Rights Issue aims to raise N239.4 billion, through the issuance of new Ordinary Shares to our shareholders. The primary objective of this Rights Issue is to further strengthen our capacity to take advantage of growth opportunities and sustain our leadership in the banking industry,” Elumelu is quoted to have said in the letter.
Explaining the use of proceeds, the Group Chairman explained that beyond regulatory compliance, the funds would be used to expand the Group’s lending capacity, investment in digital infrastructure, support sustainable business practices and expand the Group’s African operations.
Also, Elumelu highlighted how UBA was driving economic growth across Africa, citing the Bank’s historic partnership with the Africa Continental Free Trade Area (AfCFTA) Secretariat, where it pledged up to $6 billion in financing over the next three years to support eligible small and medium enterprises (SMEs) across Africa to underscore its commitment to fostering economic development.
The Bank saisd the issuance of the Rights offer was in compliance with the revised minimum capital requirements for Nigerian commercial banks announced by the apex banking regulator in Nigeria – the Central Bank of Nigeria (CBN) earlier this year.
“UBA has consistently demonstrated growth and resilience, evidenced by the Group’s strong financial performance and recent recognition within the industry.
UBA’s progressive dividend policy, which has seen an increase by 14.8% annualised dividend yield to demonstrate the Group’s ability to reward shareholders consistently,” the Bank said.
“In 2023/2024, UBA won “Bank of the Year” Awards in eight of its subsidiaries in Cameroon, Chad, Ghana, Cote d’Ivoire, Mozambique, Republic of Congo, Sierra Leone, and Tanzania, as well as the Regional Award for Africa, while in 2024 the Bank won World Best Frontier Markets Bank and Best SME Bank Africa.
The Bank said application for the provisional allotment of the Rights issue to the new ordinary Shares would be made exclusively through the NGX e-offer portal during the offer period, while existing shareholders may also apply for additional shares above their provisional allotment as described in the Provisional Allotment Letter. Shareholders who are customers of the Bank are also encouraged to access their Rights through UBA’s internet banking and mobile banking channels.
