Access Bank, a tier-1 lender, and Diamond Bank, a newly acquired financial institution, have emerged the top gainers at the close of trade Monday on the floor of the Nigerian Stock Exchange (NSE), a development which followed a merger agreement of both banks.
The shares of Access Bank jumped 9.40 percent, the bank’s biggest daily gain since January 20, 2016 to a six-week high of N18.15 per share, while those of Diamond Bank appreciated by 9.47 percent to close at N1.04 per share, their highest level in five (5) weeks.
In separate filings to the NSE on Monday, the two lenders had disclosed reaching an agreement over a potential merger “that will create Nigeria and Africa’s largest retail bank by customers.”
“The proposed merger would involve Access Bank acquiring the entire issued share capital of Diamond Bank in exchange for a combination of cash and shares in Access Bank via a Scheme of Merger,” the financial institutions said.
The volume and value of Diamond Bank’s shares traded rose by 890.94 percent 973.88 percent to 70.98 million units and N72.64 million respectively. However, Access Bank recorded a decline of 24.99 percent and 19.74 percent in volume and value traded to 13.62 units and N108.55 million respectively.
The significant increase in the volume and value of shares traded in Diamond Bank is seen as a reaction the declaration of the bank’s merger deal with Access Bank.
Meanwhile, the stock market opened the week on a negative note to reverse last week’s gains as the benchmark index of the NSE, the All Share Index (ASI) dropped 0.21 percent to 30,609.06 points, while the year to date loss worsened to -19.96 percent.