By Frank Ajuonuma
Africa’s Global Bank, United Bank for Africa (UBA) Plc, will raise N239.4bn through a Rights Issue of 6,839,884,274 ordinary shares of 50 kobo each at N35.00 per share.
The Rights Issue, which opened on Friday, November 15, 2024, allows existing shareholders to purchase additional shares in proportion to their current holdings.
It is being offered based on one new ordinary share for every five existing shares held by shareholders as of November 5, 2024.
In his letter to the shareholders informing them, the Group Chairman of United Bank for Africa, Tony Elumelu, noted that following the resolution of the Group’s shareholders at the Annual General Meeting held in May 2024, authorising the establishment of the N400bn Equity Shelf Programme, UBA will embark on a Rights Issue, as the first step in its broader capital raising programme.
“UBA’s Rights Issue aims to raise N239.4bn by issuing new Ordinary Shares to our shareholders. The primary objective of this Rights Issue is to strengthen our capacity to take advantage of growth opportunities further and sustain our leadership in the banking industry,” Elumelu said.
Explaining the use of proceeds, the Group Chairman noted that, beyond regulatory compliance, the funds will expand the Group’s lending capacity, invest in digital infrastructure, support sustainable business practices, and expand the Group’s African operations.
Elumelu also highlighted how UBA is driving economic growth across Africa. “Our historic partnership with the Africa Continental Free Trade Area (AfCFTA) Secretariat, where UBA pledged up to US$6 billion in financing over the next three years to support eligible African SMEs, underscores our commitment to fostering economic development”.
The issuance is in compliance with the revised minimum capital requirements for Nigerian commercial banks announced by the country’s apex banking regulator, the Central Bank of Nigeria (CBN), earlier this year.
UBA has consistently demonstrated growth and resilience, evidenced by the Group’s strong financial performance and recent recognition within the industry. UBA’s progressive dividend policy, which has seen an increase by 14.8 per cent annualised dividend yield has demonstrated the Group’s ability to reward shareholders consistently.
In 2023/2024, UBA won “Bank of the Year” Awards in eight of its subsidiaries—Cameroon, Chad, Ghana, Cote d’Ivoire, Mozambique, Republic of Congo, Sierra Leone, Tanzania—as well as the Regional Award for Africa. In 2024, it won the World Best Frontier Markets Bank and Best SME Bank Africa.
Application for the provisional allotment of the Rights to the new ordinary Shares will be made exclusively through the NGX e-offer portal during the offer period, while existing shareholders may also apply for additional shares above their provisional allotment as described in the Provisional Allotment Letter. Shareholders who are customers of the Bank are also encouraged to access their Rights through UBA’s internet banking and mobile banking channels.
United Bank for Africa Plc is a leading Pan-African financial institution, offering banking services to over 45 million customers across 1,000 business offices and customer touch points in 20 African countries.
With a unique international presence in New York, London, Paris, and Dubai, UBA connects people and businesses across Africa and globally through retail, commercial, corporate, and institutional banking, innovative cross-border payments and remittances, trade finance, and related banking services.
