Wednesday 01 September 2010
- Culled from The PunchThe Council of the
Nigerian Stock Exchange on Tuesday approved a N9bn special placing offer for
Wema Bank Plc. The placing was
part of the bank‘s efforts to meet the Central Bank of Nigerias
recapitalisation requirement. A statement from
the bank on Tuesday said, â€As part of its three-pronged approach towards
recapitalising the bank, Wema Bank embarked on a special placing offer to raise
an additional N9bn from a number of select high net-worth investors. The plan
which has the blessing of the CBN is expected to record a huge success, going
by the pre-offer commitment given by a number of investors to pick up the
shares on offer.â€As part of the
regulatory requirements for the approval of the special placing offer, the bank
had submitted the names of the prospective investors that had signified their
intention to take up the shares on offer to the NSE. The endorsement of the
offer effectively means that the bank has added N9bn to its capital, a major
step towards meeting the capital adequacy requirement of the apex bank.Other aspects of
the recapitalisation plan, according to the statement, include loan recovery
and sale of toxic assets, which are also ongoing. Sources within the
bank said it had achieved substantial progress in its loan recovery efforts and
over N25bn had been recovered as at the end of July 2010.Distressed assets
valued at about N37bn, according to the bank, have also been packaged for sale
to the Asset Management Corporation of Nigeria, as soon as the it commences
operations, while the bank‘s efforts have also been boosted by about N6.4bn
accessed under the N200bn SME Refinancing Fund. â€Wema Bank is on
the threshold of recovery, as the combination of fresh capital of N9bn, loan
recovery of over N25bn, the release of SME financing fund by the BOI and the
proceeds from the sale of toxic assets to AMCON will take WEMA beyond the
capital it requires to carry on its business as a bank under the new CBN
guidelines,†the statement added.