Diamond Bank to raise $309 million via rights issue

Diamond Bank said it would raise $309 million via a rights issue, at the low end of its target range, after fund-raising through a debut Eurobond also fell short last month.

Diamond, which had been looking to raise between $300 million and $400 million to lift its capital buffer, said in a filing late on Friday it had agreed to raise 50.3 billion naira ($309 million) through a rights issue to existing shareholders.

The bank said it would issue 8.68 billion shares at 5.80 naira each, representing a 14 percent discount from the closing price of Friday, Reuters reports.

This is not the first time Diamond Bank has come up short after going to the market. It raised $200 million in a debut Eurobond last month, well below its targeted range of $300 million to $350 million.

The bank is targeting a capital adequacy ratio of over 20 percent from around 17 percent now.