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Nigeria: First Inland Bank's Shareholders' Fund Hits N128.37 Billion
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Daily Trust (Abuja)
3 July 2008
Posted to the web 3 July 2008
Kayode Ekundayo
Lagos
First Inland Bank Plc has joined the league of banks with shareholders' fund in excess of N100billion as the bank's fund hits N128.37 billion.
The bank had at different times raised funds in order to shore up its capital to meet various challenges in the competive banking sector.
The total amount raised through the three categories of the offer is therefore in excess of N128.37billion.
First Inland Bank had in January this year, floated a N100billion hybrid offer comprising 5,000,000,000 ordinary shares of 50k each at N9.50k per share, 4,000,000,000 irredeemable non-cumulative convertible preference shares and Rights Issue of 968,863,000 ordinary shares of 50k each at N8.50k per share.
According to the bank, the result that has just been released is partial as the full result that would be published as soon as the Central Bank of Nigeria concludes the verification for source of capital of the outstanding result.
Over 260,000 application forms for 9,254,829,444 ordinary shares were received in connection with the offer. Out of these, three application forms for 1,900 ordinary shares were found to be invalid and rejected leaving a total of 263,845 application forms for 9,254,827,544 Ordinary shares valid under the terms of the offer. A total of N87.92billion was raised under this category.
Analysts say that with this outing, the bank's growth projection for the future has high prospects of being realized. First Inland Bank Plc went to the market in January to raise estimated net proceeds of N89, 636,683,797.27 billion after the deduction of the total offer cost of N4, 098,651,702.73 which represents 4.37 per cent of total offer proceeds.
The bank said it would utilize 17.86 per cent of the total offer proceeds on upgrade of Information Technology infrastructure, 26.90 per cent on branch expansion and head office renovation, 16.18 per cent to recapitalize and develop its subsidiaries while the remaining 39.06 per cent would be deployed as additional working capital.
Having successfully raised additional capital, the bank is now poised to meet its set goals. Already the result of the offer indicates that First Inland Bank has been highly embraced by investors. This is in spite of the timing of the offer (January) which many considered inauspicious to raise such ambitious amount.
An analysis of the above statistic shows that the ordinary shares of the offer was over subscribed by 85.10 per cent.
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The Rights Issue, another component of the offer was 114.35 per cent subscribed. A total of 24,916 applications for 1,108,470,197 ordinary shares of 50k each were received.
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