Some stockbrokers in Nigeria’s capital market have witnessed Encouraging signs of significant investor involvement in the latest public offers and rights issues by banks.
The stockbrokers expressed optimism that most banks will be fully subscribed, if not oversubscribed, citing the general public’s awareness of these offerings, according to Nairametrics.
Nigerian banks are actively stepping up their efforts to increase their capital reserves in response to the Central Bank of Nigeria’s recent announcement of higher minimum capital requirements.
These initiatives aim to boost the country’s financial system and enable lenders to play a more significant role in enhancing economic growth.
GTCO Holdings Plc, Access Holdings Plc, and Fidelity Bank Plc have made new offers after receiving approval from the Securities and Exchange Commission, Nigeria for their offer prospectuses and registration of offer shares.
The public offering of Guaranty Trust Holding Company Plc, valued at N400.5 billion, is now open for the subscription of 9,000,000,000 common shares at a price of N44.50 per share, or 50 kobo apiece.
Access Holdings Plc is currently engaged in a capital-raising initiative totaling N351 billion through a rights issue to existing shareholders. This rights issue includes the offering of 17.772 billion ordinary shares at N19.75 per share.
Fidelity Bank has started a rights issue of 3.2 billion ordinary shares at 50 kobo each, priced at N9.25 per share, to raise N127.10 billion. The bank has also started its public offer of 10 billion ordinary shares at 50 kobo each, priced at N9.75 per share.
However, no available data confirming the offer participation levels even as banks continue to invest in massive promotions.
Managing Director of Arthur Steven Asset Management Limited and former President of the Chartered Institute of Stockbrokers (CIS), Mr. Olatunde Amolegbe emphasised the increase in questions and interest in the continuing bank rights concerns and open offers.
He observed that there is a substantial engagement with these financial products, as seen by the significantly larger response than typical, especially from retail investors.
He expressed confidence that most banks will be fully subscribed, if not oversubscribed.
“This heightened interest suggests that the public is well-informed and actively participating in the investment opportunities presented by the banks,” he said.
However, Amolegbe also emphasized that it is still too early to forecast with precision what the ultimate subscription numbers will be.
According to him, many of the current offers have several weeks remaining, and the full extent of investor participation will only be clear once the subscription period closes.
He pointed out that the banks are communicating their stories to the investing public in an efficient manner by making use of their robust networks and marketing teams.
“Meanwhile, stockbrokers are playing a crucial role by providing the necessary investment advice and analysis to potential investors.
This collaborative effort is aimed at ensuring that investors are well-informed and confident in their investment decisions,” he said.
The Executive Vice Chairman of Hicap Securities Limited, Mr David Adonri noted hopeful signals of investor interest in the current public offerings and rights issues by banks.
Adonri presented his perspective based on his current grasp of the market dynamics.
“From my minimal knowledge, I think investors are participating well in the current banks’ public offerings and rights issues,” Adonri noted.
He emphasized the good trend in investor participation, noting that the response thus far indicates a robust interest in these financial products.
Adonri said his opinions reflect a cautious optimism within the financial world, as market participants constantly monitor the progress of these bank offerings.
“The eventual subscription levels will provide a clearer picture of investor sentiment and confidence in the banking sector, influencing future market strategies and financial planning,” he said.
