Fidelity gets nod to absolve PO, oversubscribed rights issue

Shareholders of Fidelity Bank Plc have unanimously approved the absorption of surplus funds arising from the potential oversubscription of its ongoing public offer.

This was one of the six resolutions secured by the bank’s Board of Directors at an extraordinary general meeting (EGM) held virtually at the weekend.

Giving a background to the resolutions considered at the meeting, which had the representatives of various regulators in attendance, including the Central Bank of Nigeria (CBN), Nigeria Exchange Group (NGX) and Securities and Exchange Commission (SEC), Chairman of Fidelity Bank, Mustafa Chike-Obi, said the bank was committed to meeting the new capital requirement stipulated by the CBN within the regulatory timeline.

“The resolution proposed for shareholders’ approval at this EGM is to enable an increase in share capital from 22.6 billion to 26.7 billion by creating 8.2 billion additional shares to accommodate potential oversubscription from the public offer and rights issue subject to regulatory approvals.

“The additional capital to be raised in the proposed resolution would also allow the bank to take advantage of emerging opportunities and secure long-term profitability and competitive advantage while ensuring increased shareholder value. We have seen a lot of demand for our shares. We think this is the chance to take on additional capital while making it easier for us to execute stage two of our capital-raising strategy. So, we think this is a good thing for us to do at this time,” Chike-Obi explained.

Several shareholders commended the bank’s leadership for its sterling performance and affirmed their support for the capital-raising exercise.

The Chairman Emeritus of the Independent Shareholders Association of Nigeria (ISAN), Sunny Nwosu, said: “I want to congratulate the board of directors on the love that people are showing for our bank as I was a part of the roadshows and I saw this firsthand. I trust that we will not disappoint them as we welcome new shareholders into our fold. Fidelity Bank is a choice bank for everybody today and as we go out, we are still converting more people to shareholders.”

The National Coordinator, Progressive Shareholders Association of Nigeria (PSAN), Mr. Boniface Okezie, noted: “I want to commend the entire board and management for taking this bold initiative. This means that not only would the Public Offer be oversubscribed, but we would also have cause to retain the excess funds. I encourage all shareholders to key into the offer as it would ultimately lead to increased returns for us.”