Growing investor confidence and strong market participation
have continue to boost optimism about Fidelity Bank’s stock as the bank
experienced a remarkable 20% surge on the Nigerian stock market, with its share
price surpassing the N13 mark by the third week of September. This upward trend
follows the bank’s combined offer, which included a Public Offer and Rights
Issue launched on June 20, 2024.
The combined offer consisted of 10 billion ordinary shares priced at N9.75 for the public and 3.2 billion shares at N9.25 for existing shareholders, collectively raising N127.1 billion. After a consolidation period from June to August, coinciding with the close of the combined offer, Fidelity Bank's shares have gained over 20% month-to-date (MtD) in September.
Fidelity Bank has maintained a robust bullish trajectory since
August 2018, when its stock dipped below N2. Since then, it has surged by more
than 680%. The bank started trading in 2024 at N10.85, with 900 million shares
exchanged. However, uncertainties related to recapitalization efforts among
major Nigerian banks led to a temporary decline to N9 per share in April.
Despite this setback, the stock regained its upward momentum after touching a
low of N9.00.
Following the completion of the combined offer in August,
Fidelity Bank’s share price climbed once again, gaining over 20% by
mid-September. A key factor contributing to this latest surge is the successful
combined offer, which paves the way for an upcoming private placement.
The Fidelity Bank combined offer, which was the first in the
current recapitalization phase in the banking industry, saw significant demand,
prompting an extension that added 8.2 billion shares. Of these, 5 billion were
sold through the Public Offer and 3.2 billion via the Rights Issue. This high
demand resulted in increased market activity, with over 2 billion shares traded
in June and 3 billion in July.
As the combined offer concluded on August 12, the stock
entered a consolidation phase, but trading activity picked up notably by
mid-September. Weekly trading volumes reached 27 million shares, pushing the
stock past the N13.00 threshold, sustaining its upward trend.
In a recent note to investors, the bank’s Managing Director,
Dr. Nneka Onyeali-Ikpe,OON expressed gratitude for the strong response to the
capital raise, stating that, “With the conclusion of the Combined Offer, I am
delighted to announce that we have met and surpassed our capital-raise target
for the first phase of this exercise.”
“My profound gratitude goes to our customers, new investors
and existing shareholders for supporting us in this journey. We will
forever be grateful for the support we received during this capital-raise
exercise.
“Our deepest thanks go to our regulators namely the CBN,
Securities and Exchange Commission (SEC) and the Nigerian Exchange Limited
(NGX): the CBN for its vision of recapitalizing Nigerian banks to ensure banks
have sufficient capital to sustain a $1tn economy in the near future and
improve the overall confidence in the banking industry; SEC and the NGX for the
role they played in ensuring the seamless execution of this first phase of our
recapitalization plans.”
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