Access
Bank has been meeting with domestic investors over the past week to gauge
interest in a possible rights issue of 60-70 billion naira ($369-$431 million)
by the fourth quarter, a fund manager and a banking source with knowledge of
the roadshow, said on Thursday.
The
lender, which raised a $400 million in Eurobond in June, wants to bolster its
core capital, the fund manager who attended the meetings in Lagos told Reuters,
declining to be named. Access Bank was also discussing with investors in Abuja.
An
official from Access Bank declined to comment.
Banks
in Africa’s biggest economy have been boosting their capital levels in recent
months, as the industry this year adopts new
international capital
requirements.
Chief
Executive Herbert Wigwe told an analysts’ conference call last week while
presenting the bank’s half-year results that he anticipated banks would need to
raise more capital as a result of the new regulations.
A
source at Access Bank said the bank was meeting with stakeholders and would
determine the amount of the fundraising after the meetings.
Adesoji
Solanke, banking analyst at Renaissance Capital, expects First Bank, which
recently raised a Eurobond, to follow with plans for extra capital as well as
United Bank for Africa (UBA) and Skye Bank.
He
said most lenders had seen capital levels drop by 100-400 basis points to near
the regulatory minimum of 16 percent under the stricter international
requirements, adding some would have to lower dividends and loan growth this
year to conserve cash.
Rival
lender Diamond Bank, which has just concluded a 50.3 billion naira rights
issue, issued a $200 million in Eurobond in May. Stanbic IBTC Bank has also
announced plans to raise 30 billion naira.
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