In response to the Central Bank of Nigeria’s (CBN) two-year bank recapitalisation exercise, which began on April 1, 2024, Access Holdings Plc, one of Nigeria’s largest financial institutions, has announced an ambitious plan to raise N351 billion through a rights issue. This move is part of the company’s broader $1.5 billion capital-raising programme, which will be executed through equity, quasi-equity, and debt issuances.
The recapitalisation exercise, set to conclude on March 31, 2026, is a crucial step for banks in Nigeria to meet new capital requirements set by the CBN. For commercial banks with international licenses, the minimum capital requirement has been raised to N500 billion, while those with national and regional licenses must maintain capital bases of N200 billion and N50 billion, respectively. The exercise also affects Merchant Banks and Non-interest Banks, with revised capitalisation baselines.
As part of its capital-raising efforts, Access Holdings is offering 17.772 billion ordinary shares of 50 kobo each to existing shareholders at a price of N19.75 per share. The rights issue, which opened on July 8, 2024, was initially set to close on August 14, 2024, but has now been extended to August 23, 2024, following approval from the Securities and Exchange Commission (SEC). The extension provides additional time for shareholders and investors to participate in the capital-raising exercise.
In a statement filed with the Nigerian Exchange (NGX), Access Holdings explained that the extension was necessary due to recent nationwide protests that disrupted business operations across the country. The company’s decision to extend the offer period underscores its commitment to ensuring that shareholders have ample opportunity to take part in the rights issue.
Stakeholders and analysts have lauded the move, expressing optimism about the potential impact on the bank’s capital base and its ability to seize emerging opportunities in the financial sector. The funds raised are expected to support Access Holdings’ ongoing working capital needs and organic growth across its banking and non-banking subsidiaries.
The rights issue is expected to significantly expand Access Holdings’ issued share capital from N17.77 billion to N26.66 billion, through the creation of an additional 17.772 billion ordinary shares. Existing shareholders have the option to purchase one new share for every two shares they currently hold, with the new shares ranking pari-passu with existing ones.
Shareholders have responded positively to the ongoing rights issue. Various shareholder associations have praised Access Holdings for its forward-thinking approach and leadership in the financial sector. They believe the capital-raising exercise will lead to substantial growth in operations and create higher value for all shareholders.
Chief Sunny Nwosu, founder and former National Coordinator of the Independent Shareholders Association of Nigeria (ISAN), expressed confidence in the success of the rights issue, predicting it will be oversubscribed. He highlighted Access Holdings’ consistent delivery of strong returns and its track record of exceeding investor expectations.
Similarly, Bisi Bakare, National Coordinator of the Pragmatic Shareholders Association (PSAN), emphasized the bank’s robust financial performance and consistent dividend payments, making it an attractive investment opportunity. Bakare encouraged her members to take up their rights, confident that the bank will continue to declare profits and dividends.
Access Holdings’ Chairman, Aigboje Aig-Imoukhuede, reiterated the group’s commitment to its shareholders, describing the rights issue as part of the company’s long-term strategy to deliver sustained value. At a “Facts Behind the Rights Issue” session at the NGX, Aig-Imoukhuede urged shareholders to participate, emphasizing that the additional capital would enable Access Holdings to maximize emerging opportunities and deliver long-term value.
As Access Holdings continues its ambitious five-year strategic plan, which aims to establish a presence in at least 26 countries by 2027, the bank is also focusing on addressing Africa’s infrastructure deficit and capital access challenges. Managing Director of Access Bank Plc, Roosevelt Ogbonna, highlighted the bank’s goal of bridging the gap and connecting Africa with the rest of the world, positioning Access Bank as a respected global financial institution.
Access Holdings is also expanding its digital infrastructure, forging strategic partnerships with international banks, and investing in technology to enhance customer service and operational efficiency. The bank’s partnership with Safaricom Plc and M-PESA Africa, along with collaboration with MasterCard, aims to improve cross-border money transfer solutions across Africa, further solidifying its leadership in the continent’s financial services sector.
As Access Holdings continues to expand its footprint across Africa and beyond, its capital-raising efforts, including the ongoing rights issue, are expected to play a crucial role in supporting its growth trajectory and delivering value to shareholders and stakeholders alike.
