Diamond Bank’s rights issue to fetch N50.4bn

Diamond this morning provided more details of a bold plan to issue 8,685,145,863 ordinary shares to raise an additional N50.4bn in new capital to improve its capital adequacy ratio and support business growth.

The rights issue is at a 14% discount to the current market price and with a BUY recommendation.

Diamond Bank shares were selling at N6.72 this morning and Rencap immediately put its target price 9% lower at N8.24 per share.

Rencap says it expects Diamond Bank to maintain a loan growth in the region of 20% in the next two to three years with deposit growth coming in higher at 25-30 per cent.