Wema Bank Share Allotment

WEMA Bank PLC has completed its N40 billion special placing and subsequent allotment of shares and approval by the Securities and Exchange Commission. Segun Oloketuyi, chief executive officer, Wema Bank, said that over the past four years, the bank had successfully repositioned itself against all odds by creating a strong platform for sustainable superior financial performance through quality personnel, better risk management and corporate governance principles, improved systems and processes and an enhanced capital base.

“The bank reported a profit in its 2013 half-year report before tax of N481 million which is a validation of the efficacy of its repositioning programme and a trend expected to be sustained into the future. This development raised the bank’s paid-up capital above the threshold for a National Banking Licence,” he said.

According to him, the bank will commence the process of securing a national banking licence in the coming months and with this approval, a total of 26,667,123,333 ordinary shares of 50k each valued at N40,000,684,999.50, was allotted to successful institutional and private investors at N1.50k per share in two tranches.

Oloketuyi, thanked the stakeholders for their support during the capital raising drive, which began months ago. He said: With this development, the shareholding structure of the bank will remain diverse with no single investor having a controlling shareholding in the bank.

More Borrowers from Microfinance Funds

Ibrahim
Ibrahim

MICROFINANCE banks in Nigeria lent N97 billion to their customers across the country in 2012. Jethro Akun, president, national association of microfinance banks, said the total loan portfolio of microfinance banks operating in the country stood at N97bn as at December 31, 2012. He noted that the microfinance sector had about five million borrowers, and had in the past few years, contributed significantly to the economic development of the country.

He said, for instance, that between 2012 and now, 22,000 people had been employed in 1,732 branches and cash centres of the MFBs adding that with six million customers, the total deposit of the sector had grown to N125bn, while the total assets stood at N222bn. He said the Nigerian Deposit Insurance Corporation, NDIC, under the leadership of Umaru Ibrahim, had introduced several initiatives that had helped to reposition the sector.

According to him, some of the initiatives are the setting up of a N16bn special fund to augment any foreseeable deficit in the premium expected from the MFBs; payment of N2.50bn to 75,322 verified depositors of 93 out of the 103 closed MFBs as of 2012; and the offer to provide on-lending package for the MFBs having liquidity issues. On the challenges facing the sector, Akun said there was the need for the review of the policy on unit branches to ensure the opening of more branches of MFBs at the local government level.

“One of the challenges we are currently facing is the issue of banks having over 50 shareholders. We have already written to the Corporate Affairs Commission, CAC, that it should be optional and we are awaiting its response. The association had currently engaged the Federal Inland Revenue Service in order to work on some areas of disagreement, which had been a problem for its members. It was agreed that the MFBs should be exempted from paying Value Added Tax, VAT, and other charges. We are pursuing these and other issues and we hope to resolve them.”

On the default rate of the MFBs in the payment of insurance premium to the NDIC, Akun said: “The corporation should develop an appropriate premium payment system by the MFBs that will include punitive measures to defaulting banks and as a condition for member banks before accessing the Micro, Small and Medium Enterprise Development Fund as contained in the guideline.” He continued that Ibrahim had threatened to withdraw insurance cover from any microfinance bank that consistently failed to pay its insurance premium and also said that about N398m had been received from the sector as insurance premium, adding that N44m was still being expected from about 100 MFBs.

— Oct. 14, 2013 @ 01:00 GMT

Contact Us