Regional lender, Wema Bank, said on Thursday it will complete a N35 billion ($220mn) private share placement to strategic investors by the end of April and apply to become national bank again, reports Reuters.
Wema was one of the lenders forced to recapitalise its operations by the central bank in the wake of a financial crisis that nearly sank it and eight other lenders. It decided to meet tougher requirements by scaling down its business to become a regional bank in the 2009.
“We expect all arrangements … to be concluded by the end of April 2013”, spokeswoman, Kemi Aina, told Reuters, adding that the new capital will enable them seek a national licence.
Regional banks can only operate in 6-12 of the 36 states. They only need N10 billion to meet the minimum capital base requirement, compared with N25 billion for national banks.
Wema Bank shares traded flat to close at N1.21 on Thursday, but they have risen 133 percent so far this year, giving it a market capitalisation of around N15.13 billion ($95mn).
In November, Wema Bank said it was at an advanced stage in raising capital and that it had secured commitments for N15 billion from core investors, which it aimed to finalise by end of 2012.
Aina said the lender had secured commitments from core investors for the whole N35 billion and had won existing shareholders’ approval for the deal.